Gold rebounds in subdued trade

Otmane El Rhazi from The Bullion Desk.

Gold futures posted moderate gains Thursday amid some mild buying interest following the prior day’s sell-off.

Gold for December delivery on the Comex division of the New York Mercantile Exchange closed up $7.30 at $1,109.30 per ounce. Trade ranged from $1,102.50 to $1,114.10.

“Gold was subdued today following yesterday’s flush out back to the $1,100 level,” Triland Metals said. “August’s bounce from the recent $1,070 low was short lived and the theme of rally selling from the last four years seems to be continuing.”

In data today, China’s August CPI at two percent beat the expected 1.9 percent but its PPI fell 5.9 percent, its 42nd straight month of decline.

Elsewhere, French final non-farm payrolls came in as expected although the country’s industrial production disappointed. Here in the US, initial jobless claims last week fell 6,000 to a seasonally adjusted 275,000, marking the 27th straight week that claims remained below 300,000.

Meanwhile, next week’s Federal Reserve meeting is expected to trigger a more definitive price movement, especially if the it decides to raise the federal funds rate for the first time since 2006.

“Next week cannot come soon enough. The regular FOMC guessing game is a necessary but increasingly tiresome feature of our markets,” ICBC Standard Bank analyst Tom Kendall said.

“Technically, gold still looks vulnerable on a daily chart and the first line of resistance is now around $1,122; the near-term prospects of the metal getting back to the $1,155/65 area have diminished,” he added.

As for the other precious metals, Comex silver for December deliver ended up 6.9 cents at $14.645 per ounce. Trade ranged from $14.535 to $14.845.

Nymex platinum futures finished unchanged at $981.20 per ounce, while the most-actively traded palladium contract settled at $592.50 per ounce, up $14.55.

In the wider-markets, the euro was 0.63 percent stronger at 1.1279 against the dollar, while the Dow Jones industrial average and S&P 500 were last up 1.05 percent and 1.0.8 percent respectively.

Light sweet crude (WTI) oil futures for October delivery on the Nymex were up $1.43 at $45.58 per barrel, while the most-actively traded Comex copper contract was at $2.4470 per pound, up 1.55 cents.

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