Gold and Silver Decline After Jobs Report
By Eric McWhinnie | May 3, 2012 5:29 AM EST
Both precious metals struggled as the private-sector added fewer jobs than predicted. According to a report by ADP, employment in the private sector increased by only 119,000 jobs in April, well below expectations of 170,000. Service-sector jobs increased by 123,000, but manufacturing and construction jobs both fell by 5,000 each.
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“This is an upsetting report,” said David Carter, chief investment officer at Lenox Advisors in New York, according to Reuters. “The strength of the U.S. economic rebound is clearly still uncertain. Hopefully we don’t get a third consecutive summer of weaker growth.” The markets still await the Bureau of Labor Statistics’ nonfarm-payroll data, which is to be released on Friday.
In afternoon trading, the SPDR Gold Trust (NYSEARCA:GLD) decreased .43 percent, while the iShares Silver Trust (NYSEARCA:SLV) dropped 1.10 percent. Gold miners (NYSEARCA:GDX) such as AngloGold Ashanti (NYSE:AU) and Newmont Mining (NYSE:NEM) both declined more than 2 percent. Silver miners (NYSEARCA:SIL) such as First Majestic (NYSE:AG) and Silvercorp Metals (NYSE:SVM) dropped 2.9 percent and 3.3 percent, respectively.
Shares of Barrick Gold Corp. (NYSE:ABX) fell 2.5 percent, despite reporting higher profits in the first-quarter. The miner said net income increased to $1.03 billion, compared to $1.0 billion a year earlier. Revenue increased 18 percent to $3.64 billion, but analysts were expecting $3.74 billion.
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Disclosure: Long EXK, AG, HL, PHYS
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