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Gold posts record one day gain on Brexit fears

Gold posts record one day gain on Brexit fears

Gold surged by as much 22% in early morning trading as investors ran for cover on the Brexit vote news.

By 9:30, the gold/sterling spot price had settled to a 12.7% rise, a record one day gain. Gold miners were rare bright spots among a sea of red, as the FTSE 100 fell by 10%, before paring back losses to 4.45% after Bank of England governor pledged £250 billion of additional liquidity.

Fresnillo was up by 11% and Randgold Resources by 14% as they benefited from the gold rush.

Gold trader Sharps Pixley said it is seeing record volumes of online trading, ‘draining’ its stocks of larger bullion bars and prompting it to tap into its emergency supply of kilobars in Germany. The firm said its stock of gold coins has also been hoovered up.

CEO Ross Norman said: ‘Gold has done what it does best and that is to provide investors with protection against currency weakness and political uncertainty- it is a safe haven asset with wealth preservation properties - the prescient investor has been well rewarded by his caution.’

GAM investment director Charles Hepworth said he is upping exposure to ‘safe haven assets’ in light of the Brexit vote.

‘Whilst this is a poor outcome for investors in general, the potentially bigger risks from the US in relation to Fed rate policy decisions and the US election warrant a retreat from high equity engagement levels we have been maintaining up to now,’ he said.

‘Capital preservation mode is the order of the day, month and quarters to come, which will see us move more to gold and other safe-haven assets and cut our UK-based earners almost completely from the funds in favour of more global revenue streams.’






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