Gold inches down in early U.S. trade

Forexpros – Gold futures traded fractionally lower in U.S. trade Friday, as U.S. payrolls showed a surprising jump last month but not enough to reduce the nation’s unemployment rate.

On the Comex division of the New York Mercantile Exchange, gold futures for October delivery traded at USD1,652.15 a troy ounce during early U.S. trade, slipping 0.05%, after hitting a high of USDS1,667.85.

On Friday, the U.S. Department of Labor announced that non-farm payrolls rose to a seasonally adjusted 103,000 in September, up from 57,000 the previous month. Market expectations were for non-farm payrolls to rise to 53,000 for the period.

Labor gains in September were due in large part to the return of 45,000 unionized workers following a strike against Verizon Communications Inc.

Separately, the Labor Department reported that the U.S. unemployment rate remained unchanged in September at a seasonally adjusted 9.1%, in line with market expectations.

Gold was on pace for its biggest gain in a month, as a rise in global equities spared investors the need to cash out holdings in precious metals to cover losses in stock portfolios.

Share prices in Europe and the U.S. got a lift from Thursday’s announcement from the European Central Bank that it would begin buying USD53 billion in covered bonds and institute longer term refinancing operations to commercials banks in the euro-zone beginning this month.

The ECB’s two-fold program was aimed at easing concerns in financial markets over Europe’s sovereign debt threats.

In afternoon trade, European shares posted modest gains with France’s CAC up 0.58% to 3,093.30, Britain’s FTSE 100 rose 0.23% to 5,303.40 and Germany’s DAX climbed 0.54% to 5,675.70.

In early U.S. trade the benchmark Dow Jones Industrial Average was lifted 0.52% to 11,181.70, while the Nasdaq Composite Index shed 0.56% to 2,492.84, and the S&P 500 dipped 0.13% to 1,163.43.

On the Comex, silver for December delivery gained 0.32% to trade at USD32.02 a troy ounce, while copper for December delivery advanced 2.04% to trade at USD3.316 a pound.