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June 5, 2020, 2:11 p.m. EDT

Gold drops to a 2-month low, down nearly 4% for the week, after upbeat U.S. jobs data

Copper prices climb, register weekly rise of over 5%

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By Myra P. Saefong and Mark DeCambre, MarketWatch


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Gold futures dropped Friday, to post a loss of nearly 4% for the week, as an unexpected monthly rise in U.S. jobs and a drop in the nation’s unemployment rate rallied the stock market, pushing prices for the haven metal to their lowest finish in two months.

“When all of the major economic data and indices have been knocked down so low, even the slightest improvements are magnified,” said Brien Lundin, editor of Gold Newsletter. “The jobs report, however, was shocking and didn’t need the magnification. Thus, the sell off today in gold and silver.”

The U.S. regained 2.5 million jobs in May and the unemployment rate fell to 13.3%, according to the Bureau of Labor Statistics on Friday.

Economists polled by MarketWatch had forecast a loss of 7.25 million jobs. The unemployment rate was forecast to rise to 19% from a post World War Two record of 14.7% in April, though states have been allowing businesses to reopen as the coronavirus pandemic recedes.

“The U.S. unemployment rate has shocked everyone because the number was much lower than the market expectation, said Naeem Aslam, chief market analyst at AvaTrade, in emailed commentary. “This a mind-blowing number and shows that the economy is improving.”

August gold /zigman2/quotes/210037452/delayed GCQ20 -0.15%  on Comex shed $44.40, or 2.6%, to settle at $1,683 an ounce. The settlement was the lowest since early April, based on the most-active contracts, according to FactSet data.

Meanwhile, July silver /zigman2/quotes/210317727/delayed SIN20 -0.10%  lost 58 cents, or 3.2%, at $17.479 an ounce, with prices ending at their lowest in roughly two weeks.

For the week, gold lost about 3.9%, while silver declined by 5.5% from last Friday’s settlements.

Looking ahead, expect a “return to basics” next week, said George Gero, managing director at RBC Wealth Management. A “global economic recovery, more political and economic headlines in [the] U.S. as elections get closer, Middle East worries, China-U.S. tariffs [concerns and] escalating trade worries,” among other things are likely to support higher gold prices in the coming weeks, he said in emailed commentary.

Elsewhere on Comex, July copper /zigman2/quotes/210057793/delayed HGN20 -1.28% tacked on nearly 2.7% to $2.5555 a pound, with most-active prices settling more than 5% higher for the week. July platinum /zigman2/quotes/211798678/delayed PLN20 -0.73%  fell by 4% to $830.40 an ounce, for a weekly loss of over 5%, while September palladium /zigman2/quotes/213028404/delayed PAU20 +0.33%  ended at $1,952.60 an ounce, up almost 1.6% on Friday, paring the week’s loss to around 1%.

/zigman2/quotes/210037452/delayed
US : U.S.: Nymex
$ 1,787.30
-2.70 -0.15%
Volume: 41,128
July 3, 2020 12:59p
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/zigman2/quotes/210317727/delayed
US : U.S.: Nymex
$ 18.23
-0.02 -0.10%
Volume: 19.00
July 2, 2020 9:05p
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/zigman2/quotes/210057793/delayed
US : U.S.: Nymex
$ 2.70
-0.04 -1.28%
Volume: 200.00
July 3, 2020 10:53a
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/zigman2/quotes/211798678/delayed
US : U.S.: Nymex
$ 816.50
-6.00 -0.73%
Volume: 3.00
July 3, 2020 11:45a
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/zigman2/quotes/213028404/delayed
US : U.S.: Nymex
$ 1,933.90
+6.30 +0.33%
Volume: 316.00
July 3, 2020 12:51p
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Myra Saefong is a MarketWatch reporter based in San Francisco. Follow her on Twitter @MktwSaefong. Mark DeCambre is MarketWatch's markets editor. He is based in New York. Follow him on Twitter @mdecambre.

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