Gold Futures End Sharply Lower As Stocks, Dollar Firm Up

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Gold prices declined sharply on Wednesday as the dollar firmed up and equities gained in strength on fairly upbeat data on factory orders, and recent report showing continued expansion in U.S. manufacturing activity.

Data showing a much smaller than expected increase in private sector employment growth in August limited gold’s slide.

The dollar index, which tumbled to a more than two-year low of 91.75 on Tuesday, rose to 92.87 in late morning trades today, and was last seen at 92.78, up nearly 0.5% from previous close.

Gold futures for December ended down $34.20 or about 1.7% at $1,944.70 an ounce, after falling to a low of $1,938.90 an ounce intraday.

Silver futures for December closed lowe by $1.250 or about 4.4% at $27.395 an ounce, while Copper futures for December settled at $3.0205 per pound, down $0.0080 or about 0.3% from previous close.

According to a report released by the Commerce Department Wednesday morning, New orders for U.S. manufactured goods showed another substantial increase in the month of July. The report said factory orders soared by 6.4% in July, matching the upwardly revised spike seen in June.

Economists had expected factory orders to surge up by 6% compared to the 6.2% jump originally reported for the previous month.

Factory orders continued to spike as orders for durable goods skyrocketed by 11.4% in July after soaring by 7.7% in June. Orders for transportation equipment led the way higher.

The Commerce Department said orders for non-durable goods also increased by 1.8% in July after jumping by 5.3% in June.

According to data released by payroll processor ADP, private sector employment increased by 428,000 jobs in August after rising by an upwardly revised 212,000 jobs in July. Economists had expected employment to jump by 950,000 jobs compared to the addition of 167,000 jobs originally reported for the previous month.

A report from the Institute for Supply Management (ISM) on Tuesday revealed that manufacturing activity in the U.S. expanded at a faster rate in the month of August.

The ISM said its purchasing managers index rose to 56.0 in August from 54.2 in July, with a reading above 50 indicating growth in manufacturing activity. Economists had expected the index to inch up to 54.5.

The material has been provided by InstaForex Company –

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