Gold futures off the lows after jobless claims data

Gold futures came off the lowest levels of the session during U.S. morning hours on Thursday, after data showed that the number of people who filed for unemployment assistance in the U.S. last week fell less-than-expected, while the previous week’s figure was revised higher, underlining concerns over the U.S. economy. On the Comex division of the New York Mercantile Exchange, gold futures for October delivery traded at USD1,765.75 a troy ounce during U.S. morning trade, dipping 0.2%. Earlier in the session prices fell by as much as 0.75% to trade at a session low of USD1,755.75 a troy ounce. Gold futures rose to as high as USD1,779.25 a troy ounce on Wednesday, the strongest level since February 29. Gold prices were likely to find short-term support at USD1,751.95 a troy ounce, the low from September 18 and resistance at USD1,792.25, the high from February 29. Prices came off the lowest levels of the session after the U.S. Department of Labor said the number of individuals filing for initial jobless benefits in the week ending September 15 fell by 3,000 to a seasonally adjusted 382,000, compared to expectations for a decrease of 10,000 to 375,000. The previous week’s figure was revised up to 385,000 from a previously reported 382,000. Jobless claims have remained below 400,000, a level historically associated with an improving labor market, in 45 of the past 47 weeks, though lately claims have been pushing higher from the 350,000 associated with above-average job growth. The disappointing data underlined concerns over the weak U.S. labor market. Gold prices rallied to a six-and-a-half-month high after the Federal Reserve said last week it will purchase USD40 billion of mortgage-backed securities every month until the labor market improves. Prices fell to the lowest levels of the session earlier in the day, following the release of worse-than-forecast purchasing managers' survey from France, the euro zone’s second largest economy. France’s manufacturing PMI fell to 42.6 in September from a final reading of 46.0 in September. Analysts had expected the index to come in at 46.4. Service sector activity in France declined to a four-month low of 46.1 in September from a final reading of 49.2 in August. Meanwhile, fresh concerns over the outlook for growth in China were fueled by data showing that the nation’s HSBC Flash Purchasing Managers Index rose slightly to 47.8 in September from a final reading of 47.6 in August. Despite the modest uptick higher, manufacturing activity in China remained in contraction territory for the 11th consecutive month, adding to fears over a deeper-than-expected slowdown in the region’s largest economy. A deeper slowdown in China, the world’s second biggest economy, would impair a global expansion that is already faltering because of the euro zone’s ongoing debt crisis. Also Thursday, Spain saw borrowing costs fall at an auction of ten-year government bonds on Thursday, amid ongoing uncertainty over whether Spain is about to ask for more financial aid, which would mean signing up to a permanent bailout fund. Spain’s Treasury sold EUR859 billion worth of 10-year government bonds at an average yield of 5.66%, down from 6.64% at a similar auction last month. Elsewhere on the Comex, silver for December delivery retreated 0.15% to trade at USD34.54 a troy ounce, while copper for December delivery tumbled 1.65% to trade at USD3.751 a pound.

Courtesy: ForexPros