Gold Advances After Lackluster Jobs Report Shows Slowing Growth
Gold price gains 1% to top $1,780 per ounce after investors flocked to the safe haven following a weak jobs report for November.
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- Gold price gains 1% to cross $1,780 as traders pile into it in search of a safe haven
- US jobs report shows a sharp decline for November – 210K new hires vs 580K expected
What’s Moving in the Markets?
Gold advanced roughly 1% on Friday and remains well-bid early Monday as investors flock to the precious metal for its safe-haven properties. As a result, gold prices reached as high as $1,785 per ounce on Friday. On Monday, the yellow metal is relatively unchanged. The rush to gold happened on the back of several major factors last week.
First, uncertainty around the Omicron variant contributed to an increase in demand for a safer place in the financial markets. On this note, the Covid-19 situation continues to be intense as the new strain is spreading quickly across major economies.
Second, gold is benefitting from a flight-to-safety as market participants weigh the prospects for a faster tapering from the Federal Reserve. In detail, the US central bank is preparing to tame surging inflation as it unwinds its $120 billion in monthly asset purchases.
Also, the US economy appeared to slow down its expansion after the latest jobs report showed lackluster performance.
Despite the gains on Friday, gold finished the week virtually flat.
Where are Wall Street Stock Headed?
In that context, buying sentiment in the stock market waned significantly on Friday. More precisely, traders and investors folded their bets on risk assets such as equities, oil, and even cryptocurrencies. The Nasdaq Composite fell nearly 2% as tech stocks slipped broadly and even led the widespread decline.
The gloomy market mood was further reinforced by a weaker-than-expected US jobs report. To this end, the American economy added 210,000 new jobs for the month in November. The number was considerably lower than the 580,000 new hires expected by economists.
With this in mind, market participants tried to erase some losses in stocks on Monday as futures floated in positive territory. It’s important to note that investors today will be looking for opportunities to enter discounted assets, especially those hurt the most last week.
In particular, Tesla stock might be in focus today as it dropped almost 7% on Friday. Longer-term, Tesla shares are down 18% in the past one month. Also, Apple, Amazon, and Meta Platforms (formerly Facebook) might attempt to recover their Friday losses of 1% or more.
What’s Happening in Cryptocurrency?
In cryptocurrency trading, major tokens endured a heavy selloff on Saturday with bitcoin’s price falling over 20%. More specifically, the most valuable crypto asset briefly traded near $42,000, after opening the day with a price of $54,000.
The steep decline affected every major cryptocurrency. Ether, the second-biggest token, tumbled more than 15% to trade under $3,500. By the end of Saturday, however, the Ethereum token had pared most of the losses and had a 4% drop on the day.
In the early hours of Monday’s trading session, leading crypto assets hover mostly in the green. Bitcoin, for example, is currently changing hands near $50,000 per coin. Ether, on the other hand, is gravitating toward $4,200 per token.
Against this backdrop, crypto backers are still confident the drop will be short-lived. In fact, many of them are using the chance to scoop up their favorite tokens at a heavy discount. It has to be noted that the outlook for cryptocurrency remains bright as more players are joining the space every day.
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