Gold Prices Settle Lower

Gold prices edged lower in trading on Friday as weaker than expected jobs report weighed down investors’ sentiment. Gold also slipped on Friday as the U.S. dollar strengthened.

Gold prices fell more than 1% for the week. On Friday, spot gold slipped 1.63% to $1,578.11 an ounce. Gold futures for delivery in August on the Comex division of the New York Mercantile Exchange settled $30.50 lower at $1,578.90 an ounce.

Bullion slipped after the Labor Department reported that the U.S. economy added 80,000 jobs in the month of June, well short of economists’ expectations. The unemployment rate remained at 8.2%.

Speaking to Reuters, Carlos Perez-Santalla, Precious Metals Broker at PVM Futures, said that it looks as though gold is just reacting to the dollar trade and weaker prices across the board, and commodities may be creeping in deflationary scares, which are weakening gold.

Although weaker than expected jobs report raised prospects of further monetary easing from the Federal Reserve, which is a positive for gold, prices still fell on Friday tracking losses in the broad market.

James Steel, Chief Metals Analyst at HSBC, told Reuters that certainly it brings up the picture of additional easing discussion of the job number remains weakened, and that alone is enough to buoy gold.

Gold prices have also come under pressure due to little support for the precious metal from the physical market. Demand for gold in the physical market has remained subdued. Data showed that Hong Kong shipped 75,456 kg of gold to mainland China back in May, representing a decline of 26% over the previous month.

Commenting on the weak physical demand, Peter Tse,   director at ScotiaMocatta in Hong Kong, said to Reuters, “The current price level isn’t attractive enough to lure buyers back…. And they (jewelers) are likely to enter the market if prices drop to $1,550-$1,560.”

Gold ETFs also fell sharply on Friday. The SPDR Gold Trust (ETF) (NYSE: GLD) ended the day 1.26% lower at $153.72, the Market Vectors ETF Trust (NYSE: GDX) ended the day 2.93% lower at $44.43, and the iShares Gold Trust (ETF) (NYSE: IAU) ended the day 1.34% lower at $15.42.

For the week GLD fell 0.95%, GDX fell 0.76%, and IAU fell 0.9%.

Silver prices also fell sharply on Friday. Spot silver dropped to $27 an ounce.

Silver ETFs also tumbled, with the iShares Silver Trust (ETF) (NYSE: SLV) ending the day 2.16% lower at $26.30, and the ProShares Ultra Silver (ETF) (NYSE: AGQ) ending the day 4.36% lower at $37.05.

The ProShares UltraShort Silver (ETF) (NYSE: ZSL), which takes a short position on silver, ended the day 4.07% higher at $69.27.

For the week, SLV dropped 1.31%, AGQ dropped 2.78%, and ZSL gained 2.08%.

In other precious metal, platinum and palladium also eased on Friday. Spot platinum slipped to $1,444.75 an ounce on Friday. Spot palladium, meanwhile, dropped to $577.25 an ounce.

Platinum futures for October delivery slipped 1.9% to $1,449.50 an ounce, while palladium futures for September delivery dropped 0.9% to $580.35 an ounce.

More Posts by this author

• U.S. Stocks Struggle for Direction Ahead of Fed’s Minutes
• SMSC (SMSC) Stockholders Approve Merger with Microchip
• Standex – SXI – Acquisition of Meder Electronic Group
• Enterprise Products Company (EPCO) Affiliate Agrees to Acquire Shell Plaza from Hines Affiliate
• Shell – RDS – Signs Share Purchase Agreement to acquire Gasnor
• hhgregg – HGG – Announces Preliminary Fiscal First Quarter Sales and Results
• OCZ Technology Group – OCZ – Record revenue for the quarter

Post Written By: Ed Liston Ed Liston is a senior contributing editor at TheStockMarketWatch.com. An active market watcher and investor, Ed guides an independent team of experienced analysts and writes for multiple stock trader publications. He is widely quoted in various financial publications on the Internet. When Ed is not writing about stocks, investing in stocks, talking about stocks, or otherwise doing something stock related, he likes to go sailing and fishing in his yacht.