Gold futures turn positive after jobless claims miss

Investing.com - Gold turned higher on Thursday, after data showed that the number of people who filed for unemployment assistance in the U.S. last week fell less than expected.

On the Comex division of the New York Mercantile Exchange, gold futures for February delivery inched up 40, or 0.03%, to trade at $1,211.10 a troy ounce during U.S. morning hours, recovering from a session low of $1,204.90.

Futures were likely to find support at $1,177.80, the low from January 5, and resistance at $1,223.30, the high from January 6.

Gold moved into positive territory after the U.S. Department of Labor said the number of individuals filing for initial jobless benefits last week decreased by 4,000 to 294,000 from the previous week’s total of 298,000.

Analysts had expected initial jobless claims to decline by 8,000 to 290,000 last week.

Continuing jobless claims in the week ended December 26 rose to 2.452 million from 2.351 million in the preceding week. Analysts had expected continuing claims to increase to 2.368 million.

A day earlier, gold lost $8.70, or 0.71%, to settle at $1,210.70, after data showed that the U.S. private sector added a larger-then-forecast 241,000 jobs in December.

The upbeat data boosted the outlook for the U.S. recovery and raised expectations for a strong reading of the government nonfarm payrolls due on Friday.

Gold lost nearly 2% in 2014 amid indications a strengthening U.S. economic recovery will force the Federal Reserve to start raising interest rates sooner and faster than previously thought.

Wednesday’s minutes of the Fed’s December meeting did little to alter expectations that U.S. interest rates will start to rise later this year.

Expectations of higher borrowing rates going forward is considered bearish for gold, as the precious metal struggles to compete with yield-bearing assets when rates are on the rise.

Also on the Comex, silver futures for March delivery declined 6.1 cents, or 0.37%, to trade at $16.48 a troy ounce.

The US dollar index, which measures the greenback against a basket of six major currencies, climbed to a 12-year high, boosted by the diverging policy outlook between the Federal Reserve and central banks in Europe and Japan.

Elsewhere in metals trading, copper for March delivery picked up 0.9 cents, or 0.34%, to trade at $2.768 a pound, amid growing expectations that the European Central Bank could implement quantitative easing as soon as its next meeting on January 22.

Meanwhile, oil prices recovered on Thursday, as investors returned to the market to close out bets on lower prices.

Nymex oil futures tacked on 28 cents, or 0.59%, to $48.94 a barrel, while London-traded Brent prices picked up 23 cents, or 0.45%, to $51.38.