Gold Recovers Ahead Of ADP Data

Mumbai-India (Feb 5)  Gold futures recovered from its yesterday’s losses on back of gains in the US stock markets and firm US dollar. The focus for the day will be on the ADP jobs data due later today.

Gold for April delivery is trading up $2.9 at $ 1254.1 an ounce on the Comex division of the New York Mercantile Exchange. Yesterday, it fell $8.70, or 0.7%, to settle at $1,251.20 an ounce.

The U.S. Commerce Department reported Tuesday that the orders for goods produced in U.S. factories fell 1.5% in December. On Tuesday the government revised November's growth to 1.5%. Orders for durable goods in December -- products meant to last at least three years -- fell 4.2% in December. Orders for nondurable goods rose 1.1%.

The movement in equities has becoming a very determining factor for gold recently. On Monday, the yellow metal futures jumped by more than $20 an ounce, propelled by a disappointing report on U.S. manufacturing and solid losses in equities.

U.S. manufacturers expanded in January at the slowest rate in eight months as the pace of new orders sharply decelerated. The Institute for Supply Management index sank to 51.3% from 56.5% in December. That is the lowest level since last May and enough to draw investors to gold.

MCX April gold futures may open today’s session near Rs 28670 levels with resistance near Rs 28750-800 levels.

On Wednesday, investors will get a preview of Friday's government jobs release in the form of ADP's private payroll employment report, which massively overshot official figures in December.

(Source: IIFL)