Europe close: Gold moves towards November highs amid investor caution

Investors remained in a cautious mood amid a dearth of fresh economic data and ahead of the week's main risk events, on Thursday.

At the closing bell, the benchmark Stoxx 600 was down by 0.67% to 389.40, alongside a retreat of 1.04% for Germany's Dax to 12,690.12 while the Cac-40 was slipping 0.73% to 5,269.22.

Among the events investors were watching out for were the European Central Bank's policy meeting on Thursday, alongside the General Elections and ex-FBI Director James Comey's testimony before a Senate panel.

"It's quite normal to see this kind of behaviour when the latter part of the week is as busy as it is. We’re seeing a little bit of risk aversion in the markets today with European futures tracking similarly small losses across the US and Asia, Gold making modest gains to trade at six week highs and the yen making further advances," said Craig Erlam, senior market analyst at Oanda.

Tellingly, dollar/yen, a popular gauge of investors' risk appetite, was down sharply, falling 0.92% to 109.43.

Against that backdrop, gold futures on COMEX rose 1.06% - and past their year-to-date highs - to $1,296.30/oz. That, technical analysts said, might signal a move back towards their November highs of $1,337/oz..

The day before, strategists at JP Morgan recommended clients stick to a defensive stance, referencing the risk of a sharp correction in US stocks, a phase of significant de-risking in Chinese assets and the possibility that Italian political risks might come to the fore sooner than expected.

In parallel, front month Brent crude oil futures were up by 0.6% to $49.77 a barrel on the ICE.

On a more positive note, according to a poll from Ipsos Sopra-Steria French president Emmanuel Macron's party was set to win the second round of the country's parliamentary elections on 18 June by the biggest margin since Charles de Gaulle's landslide victory in 1968.

Investor sentiment in the Eurozone edged higher in June, according to the Sentix institute, with its index of investor confidence gaining from 27.4 to 28.4 (consensus: 27.4).

That, Claus Vistesen at Pantheon Macroeconomics said, was compatible with a further gentle increase in the headline ZEW economic sentiment index which was set for release in the following week.

Euro area retail sales volumes edged higher by 0.1% month-on-month in April (consensus: 0.2%).

Germany's Delivery Hero AG, which was part-owned by Rocket Internet, said it was preparing a €450m flotation on the German market.

Societe Generale was looking to float up to 23% of its car leasing unit ALD Automotive this month, generating proceeds of possibly as high as €1.6bn.