Gold prices snapped back Thursday from the three-week low they settled at a day earlier as a leading dollar index suffered a sharp retreat.
Benchmark U.S. stock indexes, meanwhile, headed higher, with the S&P 500 index
SPX, +0.66%
attempting its first three-day win streak in six weeks. Strength in the stock market has contributed to gold’s overall decline week to date.
Traders have stepped in “to buy the dip in gold prices on some perceived bargain hunting and by some short covering from the futures traders,” said Jim Wyckoff, senior analyst at Kitco.com.
“Also, precious metals are seeing buying interest as the U.S. dollar index is posting sharp losses [Thursday], on a corrective pullback from recent gains that pushed the index to a 16-month high Wednesday,” he said.
Gold for December delivery
GCZ8, +1.59%
on Comex was up $16.20, or 1.3%, to $1,231.20 an ounce. Its finish at $1,215 Wednesday, on the back of a stronger dollar and a bounce for beaten-down equities, was the lowest since Oct. 10, according to FactSet data. For the week, they trade about 0.4% lower.
For all of October, however, gold prices were roughly 1.6% higher based on the most-active contracts, FactSet data showed. That represented the best month since July as the October advance came after six monthly declines in a row. Gold gained as stocks suffered a brutal and volatile October that left the S&P 500 down 6.8% for the month. The SPDR Gold Shares ETF
GLD, +1.23%
rose 1% Thursday after a 2% October rise.
The ICE U.S. dollar index
DXY, -0.76%
fell 0.7% at 96.454 Thursday after wrapping up October with a monthly rise of 2.1%. A stronger dollar can be a negative for commodities, making them more expensive to users of other currencies, and vice versa.
“The key U.S. economic data point of the week, if not the month, will be Friday’s November employment report from the [U.S.] Labor Department,” said Wyckoff. “The key non-farm payrolls number is forecast to come in at up 188,000. However, Wednesday’s ADP national employment report reading of up 227,000 suggests Friday’s jobs report could be stronger than forecast.”
Global demand for gold, meanwhile, rose by 6.2 metric tons year on year to 964.3 metric tons in the third quarter, according to a report from the World Gold Council released Thursday.
The report also said that global central bank purchases of gold rose sharply in the third quarter of this year, to the highest level in almost three years, according to a report from the World Gold Council released Thursday. Central bank net purchases rose 22% year on year to 148.4 metric tons in the third quarter. That was the highest quarterly central-bank demand figure since the fourth quarter of 2015.
Other metals traded broadly higher Thursday. December silver
SIZ8, +2.93%
rose 32.8 cents, or 2.3%, to $14.61 an ounce. Its finish at $14.282 Wednesday was the lowest since Sept. 18. The metal shed 2.9% for October.
December palladium
PAZ8, +1.68%
rose 1% to 1,079.50 an ounce after ending with a monthly loss of 0.4%. January platinum
PLF9, +2.14%
rose 1.8% at $858 an ounce, and notched a 2.5% gain in October. December copper
HGZ8, +2.03%
rose 1% to $2.686 a pound, after it had notched a monthly decline of 5.2%.
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Source : MTV
