【TOP1 Evening】Gold gains and oil dips as surging COVID-19 cases, pound buoyed by Brexit hopes

Gold 

Gold prices rose on Tuesday as surging COVID-19 cases and restrictions weighed on investors' appetite for traditionally riskier assets and boosted bets for further stimulus ahead of the Federal Reserve's policy meet.

Spot gold rose 1.1% to $1846.63 per ounce by 18:00 (GMT+8).

The pandemic continued to spread globally, prompting tighter restrictions in the Netherlands, Germany and London, while deaths crossed 300,000 in the United States.

U.S. lawmakers appeared optimistic over a fiscal coronavirus stimulus deal split into two parts in an attempt to win approval. 

Investors also looked forward to policy meetings of the Fed starting on Tuesday and the Bank of England on Thursday. 

 "While the Fed is likely to be cautious about further easing given vaccine rollouts, they will likely signal more quantitative easing ahead which will be supportive to gold," Stephen Innes, chief global market strategist at financial services firm Axi.

By 18:00 (GMT+8), silver rose 2.05% to $24.282 per ounce; bitcoin fell 0.14% to $19167.

Forex

The dollar traded near 2 1/2-year lows against major peers on Tuesday as demand for the safest assets flagged amid progress toward agreeing U.S. fiscal stimulus and optimism for a Brexit deal.

The U.S. dollar index fell 0.11% to 90.62 by 18:00(GMT+8).

At 18:00(GMT+8), the EUR/USD rose 0.01% to 1.21443; the GBP/USD was down 0.06% to 1.33106; the AUD/USD fell 0.19% to 0.75182; theUSD/JPY rose 0.07% to 104.102.

Across the Atlantic, European Union Brexit negotiator Michel Barnier said that sealing a trade pact with Britain was still possible, sowing hope that a deal can be reached with just days to avert a turbulent exit for the U.K. from the trade bloc at the end of the month.   

Crude Oil

Oil prices edged down on Tuesday as tighter lockdowns in Europe and an OPEC forecast for a slower recovery in demand next year outweighed relief from the roll-out of coronavirus vaccines.

U.S. West Texas Intermediate (WTI) crude was at $47.179 barrel, rose 0.06%, Brent was up to $50.274 a barrel, rose0.04% by 18:00 (GMT+8).

London stepped up restrictions requiring bars and restaurants to close, as COVID-19 infection rates continued to rise sharply, which will dent fuel demand in the near term.

Further marring the demand outlook, Italy said it was considering more stringent restrictions over the Christmas holidays, while most stores in Germany have been ordered to shut until Jan. 10.

Stocks

Asia-Pacific stock fell on Tuesday.

Nikkei 225 fell 44.60 points or 0.17%, close at 26,687.84.

S&P/ASX 200 fell 28.90 points or 0.43% to close at 6,631.30.

Hang Seng Index fell 182.23 or 0.69% to 26,207.29.

South Korea's Kospi fell 5.38 points or 0.19% to 2,756.82.

Taiwan capitalization-weighted stock index rose 142.53 points, or 1.00%, at 14,068.52. 

The uptrend in the semiconductor cycle is just getting started, according to investment bank Evercore ISI. On Monday, the firm named seven semiconductor stocks as "top picks" for 2021, including Nvidia stock.

"Despite another year of outperformance in 2020, we think the (semiconductor) cycle is just getting started," Evercore ISI analyst C.J. Muse said in a note to clients. Muse forecasts an uptrend of six to eight quarters.

"With every industry vertical increasingly focused on digitalization combined with key product cycles including 5G smartphones, AI/ML (artificial intelligence and machine learning), a broad-based recovery in auto/industrial (markets) as well as expected continued strength in P.C.s and a recovery in networking infrastructure/enterprise, our base case calls for semi revenues to grow 14% in 2021 to $500 billion," Muse said.

In his "2021 Annual Outlook" report, Muse selected four chipmakers and three equipment suppliers as top picks in the sector. They include chipmakers Nvidia (NVDA), Analog Devices (ADI), Micron Technology (M.U.) and Qualcomm (QCOM). Among chip-gear makers, he likes ASML (ASML), Applied Materials (AMAT) and Teradyne (TER).

Muse said Nvidia stock offers "best-in-class exposure to secular growth opportunities" in artificial intelligence, gaming and autonomous driving.

Elsewhere on Wall Street, Jefferies analyst Mark Lipacis also named Nvidia stock as a top pick in semiconductor stocks. He cited its leadership in parallel processing technology.

His other top picks include Analog Devices, Advanced Micro Devices (AMD), Microchip Technology (MCHP), NXP Semiconductors (NXPI), ON Semiconductor (ON) and Tower Semiconductor (TSEM).

Focus Tonight

22:15(GMT+8):United States Industrial Production MoM (NOV), Forecast: 0.3%, Previous:1.1%;

05:30(GMT+8): United States API Crude Oil Stock Change (11/DEC), Previous:1.141M;