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Price Group's Flynn: Syrian News, Jobs Number Underpinning Gold

Kitco News

Phil Flynn, senior market analyst with Price Futures Group, looks for gold to keep benefitting into next week at least from geopolitical factors and the softer-than-forecast U.S. jobs report issued Friday. The U.S. fired cruise missiles at a Syrian air base due to Syria’s suspected role in a chemical-weapons attack, and nonfarm payrolls rose by only 98,000 last month, the lowest number since last May. “The weaker-than-expected jobs number as well as the increasing risks – because of the chemical-weapons attacks and the response by the U.S. -- is going to give gold strong support,” Flynn says. The jobs number is likely to lower expectations for Federal Reserve tightening of monetary policy, in turn weakening the U.S. dollar, which tends to benefit gold, Flynn explains. As of 10 a.m. EDT, Comex June gold was $15.10 higher to $1,268.40 an ounce.

By Allen Sykora of Kitco News; asykora@kitco.com

 

Gold Tops 200-Day Average After U.S. Airstrike On Syria

Friday April 7, 2017 07:47

Gold moved above its 200-day average and hit a five-month high of $1,269.40 an ounce Friday after news that the U.S military launched an airstrike on Syria, souring risk appetite, analysts report. “With risk aversion set to heighten as markets ponder over the ramifications of the U.S airstrike, gold and other safe-haven assets may receive a solid boost,” says FXTM research analyst Lukman Otunuga. “While there is a possibility of a positive nonfarm payrolls report pressuring gold prices, the downside shocks may be limited by the jitters. From a technical standpoint, bulls need a solid daily close above $1,260 for a further incline higher towards $1,300.” Commerzbank analysts point out that gold’s rally after the U.S.-Syria news means the yellow metal has risen above the technically important 200-day moving average after battling to do so for days, which “could lend further buoyancy to the gold price if it were to establish a foothold above this threshold. The geopolitical risks that were made clear to market participants by today’s U.S. military action have resulted in marked buying interest in gold as a safe haven.” Gold was trading $10.90 higher at $1,262.75 an ounce as of 7:44 a.m. EDT. The 200-day average stood at $1,257.30.

By Allen Sykora of Kitco News; asykora@kitco.com

 

UBS: ‘Palladium Has A Compelling Fundamental Story’

Friday April 7, 2017 07:47

Palladium’s strong performance so far in 2017 should continue, says UBS. “Prices have been holding well and dips tend to find willing buyers,” UBS says. “Physical demand is healthy and there are some early signs that the market is tightening. We think palladium has a compelling fundamental story.” Spot palladium was trading at $805.70 as of 7:40 a.m. EDT, a gain of 19% so far this year. Meanwhile, the bank notes that declining diesel share in the automotive market is likely to result in falling platinum demand. Diesel-powered vehicle require platinum, while gasoline-powered engines use palladium instead. The bank points out that diesel share in the top five European auto markets fell by 400 basis points year-on-year last month to 47.5%. The fundamental impact of a lower diesel market share is unlikely to be immediate, but could weigh on sentiment, UBS says.

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