Metal Commodities
AP
Gold rose on Wednesday, rebounding from the previous day's
nine-month low near $1,200 an ounce, as disappointing U.S. factory data
sparked a selloff on Wall Street and prompted investors to seek a safe
haven in the yellow metal.
Also underpinning bullion was a steadying U.S. dollar amid a drop in U.S. Treasury yields and weakness in global stocks. Sharply lower airlines and transport-related shares after the first diagnosis of Ebola in the United States also helped send the S&P 500 index down more than 1 percent.
Spot gold had recovered to $1,215 an ounce, up 0.5 percent, after earlier slipping to within 10 cents of the previous day's nine-month low at $1,204.40. U.S. December gold futures were up $4.90 an ounce at $1,216.50.
U.S. COMEX December gold futures settled up $3.90 an ounce at $1,215.50 in heavy trading.
``We've seen the ADP numbers coming in a litle bit less than hoped, and that has helped give gold some support today. The dollar has dropped back slightly on the back of that,'' Mitsubishi analyst Jonathan Butler said.
Also underpinning bullion was a steadying U.S. dollar amid a drop in U.S. Treasury yields and weakness in global stocks. Sharply lower airlines and transport-related shares after the first diagnosis of Ebola in the United States also helped send the S&P 500 index down more than 1 percent.
Spot gold had recovered to $1,215 an ounce, up 0.5 percent, after earlier slipping to within 10 cents of the previous day's nine-month low at $1,204.40. U.S. December gold futures were up $4.90 an ounce at $1,216.50.
U.S. COMEX December gold futures settled up $3.90 an ounce at $1,215.50 in heavy trading.
``We've seen the ADP numbers coming in a litle bit less than hoped, and that has helped give gold some support today. The dollar has dropped back slightly on the back of that,'' Mitsubishi analyst Jonathan Butler said.
The dollar slipped 6-year highs against the yen in the wake of the ADP National Employment Report, which showed U.S. private employers added 213,000 jobs in September, as U.S yields fell. The 10-year yield dropping to its lowest since Sept. 8.
``We're very much in oversold territory from a technical point of view, and there is definitely upside risk from here as short covering takes place, but we may not have seen the washout on those price levels being taken out to the downside just yet,'' Butler added. ``It will very much depend on the data that comes out over then next few days, particularly the non-farm payrolls.''
Earlier the U.S. unit rose above 110 yen for the first time in six years and held near a two-year peak against the euro on Wednesday, as investors added to bets that U.S. data will drive the Federal Reserve to tighten policy.
A stronger dollar typically pressures assets priced in the U.S. currency, such as commodities. Tightening monetary policy and the prospect of higher interest rates also raise the opportunity cost of holding non-yielding precious metals
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