Gold prices up smartly in Asia as Crimea vote supports joining Russia

Gold prices were up smartly in early Asian trade on Monday as an annexation of the Crimean region looked inevitable after a vote on Sunday, prompting President Barack Obama to warn Russia President Vladimir Putin again that the United States and Europe are "prepared to impose additional costs" on Russia for its actions.

The U.S. and Europe have said they would impose economic and diplomatic sanctions on Russia next week, if the vote took place. On Sunday reports said an overwhelming majority supported the referendum to joing Russia and leave the Ukraine with celebrations underway. Official results are due within the day.

On the Comex division of the New York Mercantile Exchange, gold futures for April delivery traded at $1,388.80 a troy ounce, up 0.71%, after settling at $1,379.00 a troy ounce last week.

Comex gold prices ended the week with a gain of 2.95%, or $40.80, amid heightened tensions between Russia and the U.S. over Russia's involvement in Ukraine's political crisis. 

Meanwhile, weaker than expected U.S. consumer confidence data further boosted the appeal of the precious metal.

The University of Michigan consumer sentiment index ticked down to 79.9, from the 81.6 final reading in February. Analysts had expected the index to improve to 82.0.

In the week ahead, investors will be looking ahead to Wednesday’s monetary policy announcement by the Federal Reserve amid speculation the central bank is likely to continue to scale back its stimulus program.

The Fed is also to publish its economic forecasts and Fed Chair Janet Yellen will hold a press conference.

Data from the Commodities Futures Trading Commission released Friday showed that hedge funds and money managers increased their bullish bets in gold futures in the week ending March 11.

Net longs totaled 123,007 contracts, up 3.87% from net longs of 118,241 in the preceding week.

Elsewhere on the Comex, silver for May delivery traded at $21.587 a troy ounce, up 0.81% and copper for May delivery rose 0.29% 2.949 a pound. The industrial metal fell to $2.908 a pound on March 12, the lowest since July 2010.

Fears over problems in China’s financial sector also sapped risk appetite following the country’s first domestic bond default this month.

The Asian nation is the world’s largest copper consumer, accounting for almost 40% of world consumption last year.

Asian share markets slip as Ukraine tensions weigh on sentiment

Stocks in Japan and Hong Kong slipped on Monday as investors nervously awaited the West's response to Crimea's vote to break away from Ukraine and join Russia, which has drawn international condemnation.

Stock markets across Asia Pacific were mixed after the referendum Sunday in Crimea, the latest development in the volatile region, amid rising worries over another possible military incursion into Ukraine by Russia. Tensions there have weighed on global markets in recent weeks.

Japan's Nikkei lost 0.4%, while Australia's benchmark S&P ASX 200 shed 0.2% and South Korea's Kospi gained less than 0.2%. In China, the Hang Seng Index in Hong Kong lost 0.4% and the Shanghai Composite was flat.

However, business proceeded in the region with Taiwanese insurer and a Chinese private-equity firm pledging to buy a big portion of Chinese lender Harbin Bank's initial public offering, which is expected to raise around US$1 billion when it is launched Tuesday.

Fubon Life Insurance Co., an insurance unit of one of Taiwan's biggest financial firms by assets, Fubon Financial Holding Co., and Citic Capital Holdings Ltd. are among seven cornerstone investors, and have committed to buying a total of 43% of the institutional tranche of Harbin Bank's IPO, people familiar with the situation said Monday. 

But the drops in Asia mirrored the mood on Wall Street Friday. At the close of U.S. trading last week, the Dow Jones Industrial Average fell 0.27%, the S&P 500 index fell 0.28%, while the Nasdaq Composite index fell 0.35%. European indices, meanwhile, finished largely lower.

After the close of European trade on Friday, the EURO STOXX 50 fell 0.53%, France's CAC 40 fell 0.80%, while Germany's DAX 30 rose 0.43%. Meanwhile, in the U.K. the FTSE 100 fell 0.40%.

Investors were also looking at China after the People's Bank of China said over the weekend that it has decided to widen the yuan's daily trading band, allowing it to move up or down by 2% from the daily rate set by the central bank.