Gold rallied Thursday, settling above the key $1,300-an-ounce level for the first time in over a week, as the U.S. stock market, dollar and Treasury yields declined following President Donald Trump’s cancellation of a planned meeting with North Korean leader Kim Jong Un.

“It seems obvious that the spike in gold is due to the cancellation of the summit with North Korea,” Brien Lundin, editor of Gold Newsletter, told MarketWatch.

June gold US:GCM8 jumped $14.80, or nearly 1.2%, higher to settle at $1,304.40 an ounce—the highest finish for a most-active contract since May 14. Price had settled on May 17 at $1,289.60, the lowest of 2018 so far.

Prices for the metal had seen smaller gains before news, finding some support as minutes from the U.S. Federal Reserve’s May meeting didn’t indicate a more aggressive pace of interest-rate increases was in the offing. Central bank officials backed longstanding market expectations for an interest-rate hike next month.

“While another rate hike at the Fed’s next meeting in mid-June seems certain, the Fed minutes sounded more cautious about what would happen next,” said Carsten Fritsch, commodities analyst at Commerzbank, in a note.

The rise in gold prices intensified after news of the canceled meeting broke.

“Although gold had been showing moderate strength in recent sessions, I chalk up today’s spike to safe haven buying, and such moves are never long-lasting phenomena that investors should bet upon,” said Lundin.

“Still, getting back above $1,300 and putting such a buffer between it and that critical level does help the technical picture for gold,” he said.

“The upcoming Fed meeting, in which they’re expected to hike rates another quarter point, is also key for gold,” said Lundin. “Gold is typically sold off prior to expected rate hikes, and then quickly rallies in their wakes.”

On Thursday morning, in a letter released by the White House, Trump told Kim that the summit “will not take place,” and warned that U.S. nuclear capabilities are “so massive and powerful that I pray to God they will never have to be used.

The turn of events prompted U.S. stocks to extend earlier losses, though the declines have since been pared. The dollar and U.S. Treasury yields also saw sizable declines, raising gold’s appeal as an alternative investment.

The Dow Jones Industrial Average DJIA, -0.16%  was off 0.4% at 24,801. The ICE U.S. Dollar Index DXY, -0.20%  shed 0.3% to 93.70, after rising to its highest level since mid-December on Wednesday and the 10-year Treasury note yieldTMUBMUSD10Y, -1.53% fell further below the closely watched 3% line, trading down 2.9 basis points at $2.973%.

“At least for now, I think the North Korean talks – or lack thereof – are overblown,” said Adam Koos, president of Libertas Wealth Management Group. “I don’t think that this fear trade will last, long term.”

Koos said he expects gold to struggle to top $1,400 “for any lasting period of time and will, instead, likely trade sideways in the same range we’ve seen between $1,050 and $1,400 this past five years.”

Gold had twisted in choppy trading over recent days, holding ground just above its lowest finish of the year notched last week when the dollar flexed its muscle against major currencies. Prospects for higher interest rates are typically dollar-positive and a drag on gold.

Renewed trade-war jitters Thursday also weighed on the dollar, after the Trump administration said it was investigating whether to slap import tariffs on cars.

In other trading, July silver US:SIN8 rose 1.7% to $16.687 an ounce. July copperUS:HGN8  rose 0.8% at $3.096 a pound, as July platinum US:PLN8  rose 1.3% to $912.60 an ounce, but September palladium US:PAU8 the most-active contract, shed 0.2% to $966.10 an ounce.

Among exchange-traded funds, the SPDR Gold Shares GLD, +0.53%  rose 0.9%, with the iShares Silver Trust SLV, +0.48%  up 1.2%, while the VanEck Vectors Gold Miners ETF GDX, +1.00%  added 1%.


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