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1st LD Writethru: Gold up on weaker U.S. equities

Xinhua, April 6, 2016 Adjust font size:

Gold futures on the COMEX division of the New York Mercantile Exchange rose on Tuesday as U.S. equities showed weakness amid worse-than-expected U.S. data.

The most active gold contract for June delivery rose 10.3 U.S. dollars, or 0.84 percent, to settle at 1,229.60 dollars per ounce.

U.S. stocks opened lower and traded lower in the morning session Tuesday, analysts noted that when equities post losses, the precious metal usually goes up, as investors are looking for a safe haven, while the opposite is true when U.S. equities post gains.

The precious metal was given further support as a report released by the U.S. Department of Commerce showed the international trade deficit during February increasing to a worse-than-expected negative 47.1 billion U.S. dollars.

A report released by the U.S. Department of Labor on Tuesday showed job openings falling to 5.445 million, compared to a revised 5.604 million during the month of January.

However, despite the weakness, analysts said that the hiring rate increased by 0.2 points to 3.8 percent, which they say is a sign of strength in the economy as previously out-of-work workers are now looking for jobs and more confident they can find jobs.

Traders are waiting for the release of the Federal Open Market Committee(FOMC) meeting minutes due after the market's close on Wednesday. Ever since the March's FOMC meeting, traders believe that the Fed may raise rates from 0.50 to 0.75 during the June FOMC meeting.

According to the CMEGroup's Fedwatch tool, the current implied probability of a hike from 0.50 to 0.75 is at 3 percent at the April 2016 meeting, and 18 percent at the June 2016 meeting.

Silver for May delivery added 17.2 cents, or 1.15 percent, to close at 15.116 dollars per ounce. Platinum for July delivery rose 8.1 dollars, or 0.86 percent, to close at 951.60 dollars per ounce. Endit