By Barani Krishnan
Investing.com - Gold's slow foxtrot at just under $1,300 could become an extended dance.
Bullion and futures of the yellow metal traded a touch lower on Wednesday after the slight rise of the previous day. That may be exhibiting what could become a trend for a market reacting to daily headwinds from equities and the dollar, even as broader economic concerns keep it anchored in the $1,200-to-$1,300 an ounce territory.
Spot gold, reflective of trades in bullion, was at $1,290.45 an ounce by 3:30 PM ET (19:30 GMT), down $2.07, or 0.2% as Wall Street's main stock indexes rose on reports that the U.S. and China were closer to a trade deal.
Gold futures for June delivery, traded on the Comex division of the New York Mercantile Exchange, settled the official trading session just 10 cents lower at $1,295.30 an ounce.
The Financial Times reported that top officials from Washington and Beijing have resolved most of the issues in their long-running trade dispute but were still haggling over how to implement and enforce a trade agreement.
"For the time being, the report of a trade deal with China is keeping the price of gold stationary," said Walter Pehowich, executive vice-president at Dillon Gage Metals in Addison, Texas.
"The price of gold is in a need of a recharge, and that doesn’t seem likely, for the moment," he said, adding that the yellow metal could take a further knock if global growth prospects under the trade deal channels more investors toward equities.
On the contrary, poor labor market data on Wednesday gave gold some unexpected support.
Private payrolls increased by just 129,000 for the month, according to ADP, well below the 184,000 that economists surveyed by Investing.com had expected. That was the worst reading since September 2017.
The disappointing data added to signs that the hiring boom may be running out of steam after an expansion stretching back nearly 10 years.
“The job market is weakening, with employment gains slowing significantly across most industries and company sizes,” Mark Zandi, chief economist at Moody’s Analytics, said in a statement.
“Businesses are hiring cautiously as the economy is struggling with fading fiscal stimulus, the trade uncertainty, and the lagged impact of Fed tightening. If employment growth weakens much further, unemployment will begin to rise,” he added.
Palladium fell after a two-day run higher, though it stayed in the $1,400 zone to remain the world's priciest metal.
Spot palladium was down $23.35, or 1.6%, at $1,408.85 an ounce. The silvery-white auto-catalyst metal, used for purifying gasoline emissions, traded some $300 above gold early last month before cutting that premium to about $100 or less in the past two weeks.
Trades in other Comex metals as of 3:30 PM ET (19:30 GMT):
Palladium futures down $26.45, or 1.9%, at $1,373.85 per ounce.
Platinum futures up $20.30, or 2.4%, at $872.80 per ounce.
Silver futures up 3 cents, or 0.2%, at $15.09 per ounce.
Copper futures up 4 cents, or 1.4%, at $2.95 per pound.