The U.S. has just released Non Farm Payrolls and Unemployment Rate reports. Non Farm Payrolls report indicated that U.S. economy added just 266,000 jobs in April compared to analyst consensus of 978,000 jobs. The previous report was revised from 916,000 to 770,000.
Unemployment Rate increased from 6% in March to 6.1% in April. Analysts expected that is would decline to 5.8%.
S&P 500 futures are moving higher in premarket trading after the release of disappointing reports. Interestingly, poor job reports may serve as a bullish catalyst for the market as the Fed will keep providing support to markets as long as the job market has not recovered.
Gold Settled Above The $1800 Level
Gold managed to settle above the $1800 level and is testing the next resistance level at $1820. In case this test is successful, gold will move towards the $1850 level, which will be bullish for shares of gold miners. Traders’ interest in gold miners’ stocks has gradually increased over the recent weeks, and it looks that this segment is ready to test multi-week highs.
While bond traders have mostly ignored inflation fears, precious metals have seen an increase in demand since early April as speculative traders bet that higher inflation will lead to higher gold and silver prices.
Oil Continues To Pull Back As India Sets New COVID-19 Records
Yesterday, India reported more than 414,000 new coronavirus cases, which was a new daily record. While the recent inventory data indicated that oil demand was rebounding, it becomes harder to ignore the negative developments in India.
Recent concerns voiced by the cruise line company Norwegian Cruise Line Holdings, which stated that summer season might be in jeopardy if regulators moved slowly, also put pressure on traders’ mood.
It remains to be seen whether the current pullback will turn into a real sell-off as the strong economic rebound in the U.S. serves as a powerful catalyst for higher oil demand during the summer driving season. However, traders should continue to monitor COVID-19 news from India. If coronavirus gets completely out of control in India, oil may find itself under more pressure.