Gold Edges Up After U.S. Panel Approval On Syria

Gold futures edged up Thursday, slightly cutting into a sharp loss in the previous session, after the U.S. made progress toward a strike against Syria.

Gold for December delivery rose $1.80, or 0.1%, to $1,391.90 an ounce in electronic trade.

The modest move came after the Senate Foreign Relations Committee on Wednesday, in a 10-7 vote, approved a resolution allowing U.S. President Barack Obama to conduct military strikes against Syria. Obama is seeking full congressional approval for “limited” strikes in Syria.

A Senate leadership aide told MarketWatch the Syria resolution will be filed during a short session on Friday. The filing will allow for faster consideration when the full Senate returns Monday.

Results of the Senate panel’s vote came after floor trading of metals futures ended on the Comex division of the New York Mercantile Exchange.

Before the results, gold futures on Wednesday dropped $22, or 1.6%, to settle at $1,390 an ounce. That followed Tuesday’s rise of 1.1%.

Gold futures recently ran up above $1,420 an ounce, in part on expectations of an imminent U.S.-led strike against Syria in retaliation to the Syrian government’s alleged use of chemical weapons against civilians late last month. Gold had jumped alongside oil futures in anticipation of a more immediate strike, but Nymex oil futures have also pulled back, easing away from two-year highs.

“More tension in Syria may add upward pressure to gold if oil rises, but events around Syria is priced already and what is not priced, is largely speculation,” said analysts at Standard Bank led by Walter de Wet on Wednesday.

As gold prices quickly moved above $1,400 an ounce, Standard Bank said its Gold Physical Flow Index has declined in recent days. The index largely tracks Asian physical buying and selling of the precious metal, and the physical gold market is sensitive to the speed and volatility of price moves, said Standard Bank.

Gold investors are also watching developments in the U.S. economy. Later Thursday, the market will receive an estimate of private-sector job growth in August from ADP and a separate government report about weekly jobless claims.

The Federal Reserve has said improvement in the labor market will be a key component in its decision on future monetary stimulus. The Fed currently buys $85 billion in assets each month to encourage economic growth, and the stimulus measures have been credited in helping gold prices rise in recent years.

The widely watched U.S. monthly employment report will arrive Friday. Economists polled by MarketWatch expect an increase of 170,000 jobs in August, up from a preliminary reading of 162,000 in July.

A government report showing the creation of about 100,000 jobs last month would likely “prompt markets to reduce the probability and the size of a September tapering, which could well send gold toward $1,488 an ounce,” said TD Securities in a report Tuesday. “Conversely, a print above 200,000 would do the opposite, with prices moving toward $1,325 an ounce.”

Elsewhere in the metals complex Thursday, December silver   fell 11 cents, or 0.5%, to $23.30 an ounce. Futures on Wednesday slid by $1.01 an ounce, or 4.2%.

October platinum  rose $1.30, or 0.1%, to $1,496 an ounce, mildly higher after losing $43.50, or 2.8%, in the previous session. December palladium  fell $5.70, or 0.8%, to $692.55 an ounce.

December copper   was unchanged at $3.24 a pound.

Source : Marketwatch

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