Gold prices hold gains in Asia on holiday demand bargain hunting

Gold prices hold gains in Asia on holiday demand bargain hunting

Gold prices rose in Asia on Tuesday, continuing a rebound from overnight on holiday-related demand and bargain hunting.

Gold fell on Friday after the Department of Labor said the U.S. economy added 203,000 jobs in November, beating expectations for a 180,000 increase and up from a downwardly revised 200,000 rise the previous month. Also on Friday, data revealed the preliminary Thomson Reuters/University of Michigan consumer sentiment index increased to 82.5 in December from 75.1 the previous month, far surpassing expectations for a 76.0 reading.

Both reports cemented expectations for the Federal Reserve to begin scaling back its USD85 billion in monthly bond purchases in early 2014, which have supported gold prices for over a year by weakening the dollar. Bargain hunters sent prices back into positive territory on Monday, especially after Federal Reserve Bank of St. Louis President James Bullard said tapering will become increasingly likely as long as the labor market continues to improve.

“A small taper might recognize labor market improvement while still providing the Committee the opportunity to carefully monitor inflation during the first half of 2014,” Bullard said in prepared remarks of his speech.  “Should inflation not return toward target, the Committee could pause tapering at subsequent meetings.”

NYMEX crude oil rebounds in Asia on global growth prospects

Crude oil prices rose in Asia on Tuesday on continued expectations for rebounding global growth.

In the private sector, 196,000 jobs were added last month, compared to expectations for a 180,000 rise, after an increase of 214,000 in October. The report also said the U.S. unemployment rate fell to 7.0% in November from 7.3% in October, beating expectations for a downtick to 7.2%.

Also on Friday, the preliminary Thomson Reuters/University of Michigan consumer sentiment index increased to 82.5 in December from 75.1 the previous month, far surpassing expectations for a 76.0 reading.The data sent oil rising on sentiments that the U.S. economy is gaining momentum and will demand more fuel and energy going forward.

Natural gas prices shoot up on wintry weather forecasts

 Natural gas prices shot up on Monday after updated weather forecasting models continued to call for below-normal temperatures to hover across most of the country in the coming week.

Winter weather systems will tack across the U.S. over the next week bringing with them frigid air until seasonably cool temperatures settle over portions of the eastern half of the country by the third week of December, which sent natural gas prices rising.
Colder temperatures hike the need for heating this time of year, thus increasing demand for natural gas at the nation's thermal power generators.

U.S. supply levels remained in focus. Total U.S. natural gas storage stood at 3.614 trillion cubic feet as last week, more than 5% below last year's unusually high level and nearly 3% below the five-year average for this time of year.

Economic Calendar

 

Time	Cur.	Event	Actual	Forecast	Previous
Tuesday, December 10
0:45	USD	FOMC Member Fisher Speaks
5:00	USD	FOMC Member Fisher Speaks
5:31	GBP	RICS House Price Balance	58%	60%	57%
11:00	CNY	Chinese Fixed Asset Investment (YoY)		20.00%	20.10%
11:00	CNY	Chinese Industrial Production (YoY)		10.10%	10.30%
11:00	CNY	Chinese Retail Sales (YoY)		13.30%	13.30%
15:00	GBP	Industrial Production (MoM)		0.30%	0.90%
15:00	GBP	Industrial Production (YoY)		3.20%	2.20%
15:00	GBP	Manufacturing Production (YoY)		2.90%	0.80%
15:00	GBP	Manufacturing Production (MoM)		0.40%	1.20%
15:00	GBP	Trade Balance		-9.35B	-9.82B
17:30	EUR	ECB President Draghi Speaks
18:00	USD	NFIB Small Business Optimism		92.7	91.6
19:25	USD	Redbook (YoY)			4.90%
19:25	USD	Redbook (MoM)			-0.20%
20:30	GBP	NIESR GDP Estimate			0.70%
20:30	USD	Wholesale Inventories (MoM)		0.30%	0.40%
22:00	USD	4-Week Bill Auction			0.03%
22:00	USD	52-Week Bill Auction			0.14%
23:30	USD	3-Year Note Auction			0.64%