International spot gold traded at $1,712 an ounce in Asia on Friday, after climbing to a choppy high of $1,721.66 an ounce in the previous session.
Spot gold rose as high as $1,721.10 in early morning trading at $1,697.02 and dipped as low as $1,696.36 to close at $1,713.59, up $16.11, or 0.94 percent.
Meanwhile, August gold futures on COMEX closed up $22.60, or 1.3 percent, at $1,724.40 an ounce.
Daniel Ghali, commodities strategist at TD Securities, said: “Equities are still on the downside and for gold market participants this is being interpreted as a flight to safety, leading to increased investment demand.”
In the latest sign of u.s.-China relations, U.S. officials said Friday that the U.S. government plans to change the no-fly zone imposed on Chinese airlines. (Reuters) – The U.S. Department of Transportation plans to issue a revised order in the coming days that could allow some Chinese passenger jets to continue flying, Reuters reported, citing GOVERNMENT and airline officials.
Earlier in the day, media reports said the U.S. Department of Transportation would issue a revised order allowing Chinese passenger airlines to continue operating flights in the United States. The TRANSPORTATION Department plans to issue a revised order in the coming days that could allow some Chinese passenger jets to continue flying U.S. routes, government and airline officials said. The US plans to revise its ban after the Chinese government announced on Thursday that it would relax restrictions on the coronavirus to allow more foreign airlines to operate passenger flights in the US.
The Civil Aviation Administration of China (CAAC) on Thursday issued a notice on the adjustment of international passenger flights. Starting from June 8, 2020, all foreign airlines not included in the “Phase 5” flight plan can select a port city capable of receiving and operate one international passenger flight per week within the company’s business license, the circular said. After the adjustment of international passenger flights, 44 airlines from the 23 countries that currently operate flights are expected to add up to 44 flights per week.
Earlier this week, the trump administration announced that Chinese passenger airlines would be banned from flying to the United States starting June 16, and U.S. embassies and consulates in China would cancel immigrant and non-immigrant visa appointments for June 8, solstice and June 26.
Next, we need to keep an eye on the latest developments in China-us relations. Any new news is likely to trigger market fluctuations.
The U.S. non-farm payrolls report for May will be released on Friday at 20:30 Beijing time. Nonfarm payrolls are expected to drop 8 million in the may quarter after the revision, the unemployment rate is expected to surge to 19.5 percent in May, the survey showed, and average hourly wages are expected to rise at an 8.5 percent annual rate.
Economists surveyed by Dow Jones expect nonfarm payrolls to fall 8.3 million and the unemployment rate to hit 20.5%, more than double its highest level since the Great Depression.
Economists at Goldman Sachs expect nonfarm payrolls fell by 7.25 million in May and the unemployment rate to hit 21.5 percent, after April’s employment figures are likely to be revised downward. Goldman will continue to pay particular attention to the number and proportion of furloughs or temporary layoffs as it interprets the report.
Michelle Meyer, chief U.S. economist at Bank of America in New York, said the U.S. labor market report for May is important because it will give a clearer picture of just how severe the economic downturn has been, and it will take a long time for the labor market to fully recover due to high unemployment.
And it should be noted that despite the market’s downbeat expectations, Wednesday’s small U.S. non-farm farm ADP data was surprisingly much better than expected, leaving some in the industry with some expectations.
A raft of economic data released this week suggests that the worst may be over for the pandemic as measures related to the outbreak are gradually eased.
The number of Americans filing new claims for state unemployment benefits fell to 1.877 million on May 30, the Labor Department reported on Thursday. CNBC said it showed the worst of the coronavirus-related jobs crisis was over, but unemployment remained high.
The claims report comes a day after ADP’s private payrolls report on Wednesday showed 2.76 million jobs were lost in May. While that is still far above the performance of the US economy before the coronavirus outbreak, it is also far below Wall Street’s expectations of 8.75 million.
Market analysts Vince Golle and Reade Pickert wrote that while U.S. ADP employment was better than expected in May, Wall Street’s slight revision of its may non-farm payrolls did not change the bearish tone.
Seema Shah, chief strategist at Principal Global Investors in New York, said it is entirely possible that there will be a critical point in the future where a second wave of unemployment and prolonged business failures will test market sentiment.
On the daily chart, the DOLLAR index maintained its recent decline, the MACD green momentum column held steady, and the KDJ random index continued to come under pressure, indicating that the dollar’s downward momentum is still in place, and the coming sell-off will continue.
On a 4-hour chart, the DOLLAR index extended its decline to a low of 96.57 before continuing to struggle in a tight range near lows. MACD green momentum column held steady, KDJ random indicator continued to fall, indicating that the dollar will also remain weak in the short term.
On the daily chart, gold maintained a volatile retreat, temporarily holding just above the 50-day average, with the MACD green momentum stable and the KDJ random index slightly flat, indicating that gold’s downward momentum is still there, but the downside is limited for the time being and could be locked into a period of tight consolidation.
In the 4-hour chart, gold maintained its rally since its low of $1689 / oz, MACD green momentum column remained unchanged, and KDJ random index was moderately upward, indicating that gold maintained the momentum of the rebound in the short term, but may temporarily consolidate for now.
Fundamentals positive factors:
- According to statistics from Worldometers, as of June 5, Beijing time, there have been more than 6.68 million confirmed cases and more than 390,000 deaths of COVID-19 worldwide. In the United States, meanwhile, there have been more than 1.92 million confirmed coVID-19 cases and 110,000 deaths.
New claims for jobless benefits fell to 1.877 million as of May 30, labor Department data showed On Thursday, while Economists polled by Dow Jones had expected 1.775 million. CNBC said it showed the worst of the coronavirus-related jobs crisis was over, but unemployment remained high. Since the coronavirus lockdown in mid-March, more than 42.6 million Americans have applied for unemployment benefits.
The US trade deficit surged in April, reigniting fears of a slowdown as the COVID-19 outbreak upended global flows of goods and services and pushed US exports to a 10-year low. Data from the Commerce Department on Thursday showed the trade deficit jumped 16.7 percent to $49.4 billion in April as exports fell to a 10-year low. The trade deficit in goods with China was $22.47 billion in April, compared with $11.83 billion in March.
April, Thursday (June 4) announced that the United States may challenger enterprises cut 397,016 million jobs. The President of Challenger, an employment data firm, said job cuts were the second highest since records began in 1993.
Fundamentals negative factors:
The US Department of Transportation plans to issue a revised order in the coming days that could allow some Chinese passenger jets to continue flying, Reuters reported on Friday, citing GOVERNMENT and airline officials.
- On Thursday (June 4), the Civil Aviation Administration of China issued a notice on the Adjustment of International Passenger Flights. Starting from June 8, 2020, all foreign airlines not included in the “Phase 5” flight plan can select a port city capable of receiving and operate one international passenger flight per week within the company’s business license, the circular said. After the adjustment of international passenger flights, 44 airlines from the 23 countries that currently operate flights are expected to add up to 44 flights per week.
- On Thursday (June 4), the European Central Bank (ECB) announced that it will expand its PEPP program by 600 billion euros to 1.35 trillion euros and extend the maturity of its bond purchases until the end of June 2021. The European Commission has proposed expanding scrutiny of foreign investment in the region as part of an effort to protect more industries from potential Chinese buyers, according to a draft public document.
- Wednesday’s ADP employment report showed private employers cut another 2.76 million jobs in May, better than the expected 9 million drop. The figure was much better than expected, suggesting the worst may be over.