The yellowish metal pushed toward its top value in more than seven days as investors and economists considered the denouement of stimulus policy of the U.S. Federal Reserve. The whitish metal pushed to its top value in more than 14 days during the Wednesday trade session after ADP Research Institute released data noting the labor market of the U.S. is lagging.
That data came in advance of the official report, which the U.S. Department of Labor is prepared to release on Friday.
"With stock markets doing bad, there should be no logic in shorting gold," head of currency and metal trading Bernard Sin with bullion refiner MKS SA in Geneva, Switzerland told the news source on Thursday. "Precious metals were supported by the dollar and U.S. figures. With China out there hasn't been much movement in physical demand, so we expect some movement next week."
At 9:35 a.m. on Thursday, gold futures edged up 0.07 percent, an 82-cent lift to $1,258.74 per troy ounce. Silver futures gained 0.56 percent, an 11-cent rise to $20 per troy ounce.
Both metals have performed more strongly than expected thus far this year. In 2013, gold futures failed to deliver annual gains for the first time in 12 years. The record price for bullion is $1,923.70 per troy ounce, as established in September 2011.
Silver futures, whose all-time high is $50.35 per troy ounce as set in 1980 when the Hunt Brothers of Texas attempted to corner the silver market, marked gains of more than 1 percent during the Wednesday trade session. The volatile metal advanced to its top value since the middle of last month.
Buyers are returning to precious metals as prompted by less-than-stellar economic data, one broker told Bloomberg.
"The correction in equities and disappointing economic data are pushing people to safe-haven assets," broker Tommy Capalbo with Newedge Group in New York told the news source on Thursday, noting the "ADP data did not meet market expectations, and people have started wondering whether the Fed will continue to taper."
Jobs report anticipation runs high
Reuters reports market participants were cautious in advance of the Friday jobs report to be issued by the U.S. government. The euro was pushing ahead against the world's reserve currency, which also was beneficial to the precious metal during the Thursday trade session.
But one commodity researcher said that bounce was underwhelming.
"Gold should have done better considering the spike we are seeing in EUR/USD," head of commodity research Ole Hansen with Saxo Bank told Reuters on Thursday. "Several failed attempts above $1,272 has left many potential bulls on the sidelines, waiting for a definite break. Volumes have been quite subdued as well, so we probably need more fireworks. Next thing up will be the job report tomorrow."
Trade deficit figures to impact economic status
In addition to the Friday jobs report, MarketWatch reports another component of economic data that is likely to impact the price of gold futures is information regarding the U.S. trade deficit, which is slated for release on Thursday.
In November of last year, the metric scraped its lowest rate since 2010. The news source noted the gap is likely to have increased in size during January, but not by very much as it likely remained about its recent low level.
An analyst with INTL FCStone said the yellowish metal is likely to react upward as global equities are pinched.
"We think that the correction in the U.S. stock market likely has more room to go and that the turmoil in the emerging-market currencies is not yet over," analyst Edward Meir told the news source. "Both these variables should provide the precious metal with enough momentum to push higher."
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