Gold prices down despite upbeat US jobs numbers

Gold prices resumed their downward slide Wednesday, hitting a 5-month low, and is now within shouting distance of the psychologically important $1,200 level and the three-year low of $1,180, despite strong US jobs numbers.

On the Comex division of the New York Mercantile Exchange, gold futures for February delivery traded at $1,225.70 a troy ounce during morning trade, up 0.4%.

The precious metal has been under pressure as markets believe a recovering economy could prompt the Fed to slow the pace of its $85 billion in monthly bond purchases as soon as December.

The market got its first taste of US jobs numbers today, with the November ADP non-farm payroll number coming in at 215,000 jobs added, easily beating the 172,000 forecast and the 184,000 reading in October, which was also revised upwards from 130,000.

Investors are waiting now for the US new home sales data due later Wednesday as well as a report from the Institute of Supply Management on services sector activity to further gauge the strength of the economy and the need for stimulus.

More US critical data is coming tomorrow, when the country releases third quarter gross domestic product.

The Federal Reserve, which holds its next meeting on December 17-18, has said the timing of its tapering depends on the health of the labour and housing markets.

Gold is down about 28% this year, heading for the first annual loss in 13 years, as solid U.S. economic data underlined expectations the Fed will begin curbing stimulus.

The Dow Jones Industrial Average

The Dow Jones Industrial Average and the S&P 500 closed modestly lower, while theNasdaq managed to notch out slight a gain. The Dow and S&P 500 have fallen for the past four days.

Investors were paying close attention to economic data. In its Beige Book report on regional economic activity, the Fed said the economy expanded at a “modest to moderate pace” from early October to mid-November.

It noted gains in the auto and high-tech industries and reported that retailers are “hopeful, but cautious” about the holiday shopping season.

Investors remain fixated on clues as to when the Fed might pull back, or taper, its $85 billion per month bond buying program.

The three indexes were in the green earlier Wednesday after the Census Bureau said sales of new single family residential homes rose 25% in October compared to September, topping economists’ expectations.

That report came after payroll processor ADP (ADP, Fortune 500) reported that215,000 private-sector jobs were added in November — well above the 160,000 gain that was expected.

Bond investors stayed focused on when the Fed might taper. The yield on the 10-year Treasury note was 2.83% after spiking to 2.85% earlier in the day, near the year’s high of almost 3% back in September.

At that time, investors feared the Fed would taper at its meeting in September. It didn’t. But some experts believe that the Fed could now announce it is pulling back on stimulus at the conclusion of its next meeting on December 18.

Related: Fear & Greed Index still shows greed

In corporate news, J.C. Penney (JCP, Fortune 500) said Tuesday that same-store sales in November grew 10% from the same period last year. The stock, which has been the worst performer on the S&P 500 this year, is in the midst of a turnaround and has caught the attention of some major hedge funds.

But investors seemed unimpressed with the decent November sales. Shares of J.C. Penney ended the day down over 4%.

Despite that, one trader on StockTwits was bullish that it would bounce back by the end of the day.

$JCP green by close,” said Jason100.

That didn’t happen. Others were optimistic, but acknowledged it’s a difficult trade.

“$JCP only patient ppl or idiots can win this stock LOL”, said Smellyegg.

Shares of Deere (DE, Fortune 500) jumped over 3% after the agricultural machinery giant announced it boosted its share repurchase program.

“Stopped out of $DE ystdy after holding for 2 weeks & today they announce buyback” saidSspencer_smb, a StockTwits trader who worried he missed out on the stock’s recent move.

Another mover was Hewlett-Packard (HPQ, Fortune 500), which closed more than 2% higher after reports that the PC and printer maker plans to shed 1,100 jobs in its U.K. unit.

StockTwits trader Shaggyeleven was not buying the stock for now, but is keeping a close eye on it.

“$HPQ not in, watching, if keeps moving like this, thinking, I’m missing something.”

Also trending on StockTwits: Apple (AAPL, Fortune 500).

Shares of the iPad maker have surged back to life in recent months, gaining almost 50% from its 52-week low earlier this year. Activist investor Carl Icahn reiterated in an interview with Time Wednesday that he wants the company to buy back more of its stock.

“$AAPL slow and steady rise the rest of the day” said trader ChazMac09.

Facebook (FB, Fortune 500)shares jumped 4%, giving it an overall gain of over 82% since January. There was a lot of chatter that the social networking stock could soon be added to the S&P 500. 

IronClad Mining’s Lucky Bay export port gains state development approval

A company given state development approval for a mining export facility on eastern Eyre Peninsula in South Australia says it hopes to start exports next year.

IronClad Mining plans to ship iron ore from Lucky Bay near Cowell from its Wilcherry Hill mine near Kimba.

The ore will be taken on barges to ships offshore.

IronClad managing director Robert Mencel says the port also could cater for exports other than minerals.

“It suits itself to a whole range of commodities, both minerals and other commodities, for example our crane and our dumb barge will only be used approximately 30 per cent of the time and so subject to other approvals there’s no reason why other parties can’t come and talk to us about using those facilities when we’re not using them,” he said.

Dumb barge A barge for the transportation of cargo, which does not have its own engine but is towed or pushed by another power-driven vessel
(Macquarie Dictionary)

 

Some shack owners at Lucky Bay have environmental worries.

But Mr Mencel says safeguards will include an acoustic mound to help shield residents from noise.

“I can assure you that we have done extensive environmental studies, we have been vetted by both the federal and local government, by the EPA (Environment Protection Authority) and have come out thumbs-up – there are no environmental issues there,” he said.