MW: Gold rises as employment report further derails dollar
Copper prices take a breather following Tuesday's 19-month high
By Nick Godt & Claudia Assis, MarketWatch
NEW YORK (MarketWatch) -- Gold futures traded higher on Wednesday, as a weaker-than-expected U.S. employment report knocked down the dollar and brought buyers back into the precious metal.
Gold for June delivery, the most actively traded contract, rose $10.40, reaching $1,116 an ounce on the Comex division of the New York Mercantile Exchange.
Moves in the foreign-exchange market remain the main influence on gold, said Frank Lesh, a broker and futures analyst with FuturePath Trading in Chicago.
"This week we really had a pretty strong correlation between gold and the dollar," he said. As the markets head toward an extended weekend, thin trading helped cement the relationship, he added.
Most markets are closed for Good Friday, and several European markets are closed the Monday following Easter.
The U.S. currency started the day on a wobbly note and fell further after a survey by payroll-processor ADP said companies in the private sector cut 23,000 jobs in March. Analysts surveyed by MarketWatch had expected an increase of 40,000 jobs.
The government's official U.S. tally for March employment will be released on Friday.
"Continuing geopolitical tensions with Iran with President Obama seeking tougher sanctions against Iran may have also have contributed to gold's rise," said George Gero, metals analyst at RBC Capital.
"Physical demand remains robust internationally as seen in healthy premiums in Turkey, Vietnam, India and China," he said.
The dollar index (DXY 81.03, -0.44, -0.54%) , which tracks the greenback against a basket of six major currencies, fell 0.5% to 81.03.
Copper, which hit a 19-month high on Tuesday, slightly declined.
"It's a pause," FuturePath's Lesh said. "Today's ADP (survey) put a little damper on economic recovery talks," he said, clouding the picture for copper demand.
After the highs earlier in the week a small pullback was expected, he added.
Copper for May delivery, the most actively traded contract, retreated a penny, or 0.2%, to $3.56 a pound.
Other metals tracked the move higher in gold.
Silver for May delivery gained 25 cents, or 1.5%, to $17.57 an ounce, while palladium for June delivery rallied $10.40, or 2.2%, to stand at $480.75 an ounce.
