Support from developments in Ukraine offset earlier pressure from a stronger-than-expected reading on durable-goods orders, which bolstered expectations that economic growth could pick up, suggesting the Federal Reserve will continue reducing its monetary stimulus.
Gold futures have fallen below a technical support level of $1,278.Gold for June delivery tacked on $5, or 0.4%, to $1,289.60 an ounce on the Comex after trading as low as $1,268.40 in electronic trading.
Prices were trading at under $1,280 when news reports emerged that Russia planned to launch military exercises near the Ukraine border in response to the latest clashes in which at least five pro-Russian activists were killed.
Traders are taking this threat very seriously and we having seen a hasty change in sentiment on our end,” he said. “If Russia does follow its plan, then we will anticipate a further sharp selloff across the board for the equity markets and groundbreaking earnings reports from Apple and Facebook may not be able to pull the markets up.”
Gold could be the biggest beneficiary of this situation and in no time we could be back above the $1,300 level. The dollar index is strongly under pressure as well after this news,” he said.
The market was focused on U.S. economic data early Thursday. The number of Americans who applied for unemployment benefits last week rose to the highest level in April but March orders for durable goods jumped 2.6% — the biggest gain in four months.
Elsewhere in the metals complex, prices traded broadly higher. May silver climbed 29 cents, or 1.5%, to trade at $19.73 an ounce. High-grade copper for May delivery rose nearly 5 cents, or 1.6%, to $3.11 a pound.
July platinum added $8.10, or 0.6%, to trade at $1,410.80 an ounce. June palladium rose $15.15, or 1.9%, to $800.75 an ounce.
Gold and silver miners traded mainly lower, however, with the Philadelphia Gold and Silver Index losing 0.3%. Shares of Freeport-McMoRan Copper & Gold Inc. tacked on 2.1% after the company early Thursday reported first-quarter earnings that declined from a year ago, but topped Wall Street’s expectations.
The SPDR Gold Trust was up 0.3% in the latest dealings.