Gold jumps as US jobs report jolts investors

AP News
Posted: Sep 02, 2011 4:35 PM
Gold jumps as US jobs report jolts investors

Gold approached another record high Friday as a bleak jobs report added to fears that the U.S. economy is weakening.

Gold jumped $47.80, or 2.6 percent, to end at $1,876.90 an ounce. That's just $15 shy of the closing high of $1,891.90 an ounce reached Aug. 22. .

Investors were jolted by the jobs report. The Labor Department said no jobs were added in the U.S. economy last month and the unemployment rate remained at 9.1 percent. The report was far weaker than analysts had expected and renewed concerns that the U.S. might be headed for another slowdown or recession.

Europe's debt problems are still dragging on, and China's economy is showing signs of slower growth. Those problems could weaken global demand for many kinds of commodities including oil, metals and agricultural products such as corn, soybeans and wheat.

As a result, investors having been buying gold, sending its price up 50 percent over the past year. Gold, which isn't tied to any particular currency, is seen by investors as a relatively stable store of value during times of economic weakness and turbulence in financial markets.

Many analysts expect gold to continue to climb if global economic worries persist. Some have speculated it could reach about $2,250 an ounce before the end of the year.

"I think there's a general concern over the economy and the lack of a clear direction," Telvent DTN analyst Darin Newsom said. "Throughout history, gold has been seen as this one thing you can always rely on."

Adjusted for inflation, gold is still below the peak it reached in 1980.

In other trading, September silver rose $1.537, or 3.7 percent, to finish at $43.069 an ounce, December copper fell 3.6 cents to $4.1245 a pound, October platinum increased $31.90 to $1,884.80 an ounce and December palladium fell $7.20 to $783.20 per ounce.

Benchmark crude fell $2.48, or 2.8 percent, to end at $86.45 per barrel on the New York Mercantile Exchange.

In other Nymex trading, heating oil fell 5.44 cents to $2.9974 per gallon, gasoline futures fell 5.31 cents to $2.8396 a gallon and natural gas dropped 17.8 cents to $3.872 per 1,000 cubic feet.

Wheat, corn and soybeans all ended higher. December wheat rose 14.5 cents to $7.755 per bushel, December corn increased 21.5 cents, or 2.9 percent, to $7.60 per bushel and November soybeans rose 11.25 cents to $14.4575 per bushel.