Gold higher ahead of U.S. jobs report

Gold futures are looking to end the week in strong fashion and are trading higher in the early of Friday’s Asian session ahead of the February non-farm payroll report due out from the U.S. Labor Department later today.

On the Comex division of the New York Mercantile Exchange, gold futures for April delivery rose 0.21% to USD1,578.40 per troy ounce in Asian trading Friday. The yellow metal settled up 0.01% at USD1,575.10 a troy ounce in U.S. trading onThursday.

Gold futures were likely to test support USD1,566.80 a troy ounce, Wednesday's low, and resistance at USD1,1619.40, the high from Feb. 26.

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Precious Metals Under Pressure As Equity Markets Soar

Precious metals prices rose yesterday, but the breakout in Wall Street stocks to new highs and data showing an improving U.S. economy pressurized the precious metal’s safe-haven appeal. The Fed’s Beige Book showed a slow recovery but a positive recovery was underway with an improvement in most sectors. The slowing factor was the “fiscal cliff” and the new payroll tax increases and all the political rhetoric from Washington, held back consumers and businesses. With most of this behind the economy is expected to pick up its pace of recovery. The ADP release yesterday showed that the economy had generated over 198,000 new jobs against estimates of 170,000. This gave a bump to the US dollar and held gold down as the good news on one front can be bad news for central bank speculators as it might push the central bank to lower or terminate its monetary stimulus program. This helped support the US dollar and kept gold on the weak side. Gold is holding at 1580.50 this morning adding a few dollars as traders take advantage of the weak price ahead of central bank decisions today.

Global central bankers are meeting today in Japan, England and Brussels and more stimulus or lower interest rates are expected. This afternoon’s press conference by Mario Draghi is expected to have major market effects.

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"Tug of war" in Gold as Asians buy physical and ETF investors sell

London Gold market report

U.S. dollar prices to buy gold hovered around $1575 per ounce Wednesday morning in London, in line with last week's close, as dealers in Asia reported an increase in demand for physical bullion, in contrast with exchange traded funds, which have continued to see selling, in what one analyst calls a "tug of war" between physical buying and ETF selling.

"Short-term, gold should drift lower to the short-term support line at $1569/65 or even to the previous low at $1555," say technical analysts at Societe Generale.

"Initial support is at 1564.88," adds UBS.

"A break below [that level] would expose $1556.50, the June 28 low and then $1533.70, the May 16, 2012 low." 

Gold in Sterling hovered just below 1045 pounds an ounce for most of this morning, slightly down on the week, while gold in Euros stayed below €1210 an ounce.

Silver meantime hovered around $28.70 an ounce, very slightly up on the week, while other commodities were similarly flat. Stock markets extended yesterday's gains, in contrast with major government bond prices which fell.

"We remain somewhat cautious on gold and silver," says INTL FCStone analyst Ed Meir.

"They could be hit by a downward reversal if and when markets start to decouple from the surging equity markets."

Stock markets in Europe extended gains on Wednesday morning after several major indices closed at multi-year highs Tuesday.

In London, the FTSE 100 posted its highest close since January 2008 yesterday, while over in the US the Dow saw a new all-time record close and the S&P 500 closed at its highest level since October 31 2007, less than 2% off its all-time record close set earlier that month.

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Natural Gas surges to 6-week high on bullish supply data

Natural gas futures surged to a 6-week high earlier Thursday after official data revealed supplies fell more than expected last week.

On the New York Mercantile Exchange, natural gas futures for delivery in April traded at USD3.580 per million British thermal units, up 3.18%.

The commodity hit a session low of USD3.463 and a high of USD3.602.

The U.S. Energy Information Administration said in its weekly report that natural gas storage in the U.S. in the week ending March 1 fell by 146 billion cubic feet, well beyond market expectations for a drop of 134 billion cubic feet.

Inventories fell by 92 billion cubic feet in the same week a year earlier, while the five-year average change for the week represented a decline of 107 billion cubic feet.

Total U.S. natural gas storage stood at 2.083 trillion cubic feet as of last week. Stocks were 361 billion cubic feet less than last year at this time and 269 billion cubic feet above the five-year average of 1.814 trillion cubic feet for this time of year.

The report showed that in the East Region, stocks were 73 billion cubic feet above the five-year average, following net withdrawals of 77 billion cubic feet.

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