Oct 23, V7N- Gold prices surged to a record high, hitting $2,749.07 per ounce, as investors sought safe-haven assets amid geopolitical tensions in the Middle East, uncertainty surrounding the U.S. election, and mixed signals from the Federal Reserve on rate cuts. The U.S. dollar also strengthened, reaching multi-month highs against major currencies, including the yen, which dropped to 151.74 per dollar, and the euro, which fell to $1.0792.

The shift in market expectations for the Federal Reserve's rate-cutting pace has dampened risk sentiment, leading to a rise in U.S. Treasury yields. The benchmark 10-year note yield climbed to 4.216%, reflecting investor caution over the possibility of the Fed holding off on aggressive rate cuts in response to a strong U.S. economy. Market participants now expect a 25 basis point cut in the coming months, with the Fed potentially taking a more cautious approach.

In Asia, stock markets showed mixed performance. The MSCI Asia-Pacific index was up 0.06%, while Japan's Nikkei opened slightly lower. Chinese and Hong Kong markets saw stability, supported by expectations of government intervention to bolster the economy.

Investors remain wary of potential market volatility ahead of the upcoming U.S. election. Recent betting odds suggest a slight shift towards a potential Donald Trump victory, with his policies expected to drive inflation and keep U.S. interest rates elevated. However, opinion polls show a tight race with Vice President Kamala Harris, the Democratic candidate.

In commodities, oil prices declined slightly after a strong start to the week. Brent crude futures dropped 0.4% to $75.73 per barrel, and West Texas Intermediate (WTI) eased 0.38% to $71.47 per barrel.

With two weeks remaining before the U.S. election, markets are bracing for further volatility as investors assess the impact of both political outcomes and economic developments.

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