Gold Gains in Asia as U.S. Jobs Data Triggers Equities Tumble

3 July 2009  Bloomberg.com

Gold advanced in Asian trading after worse-than-projected U.S. jobless figures triggered a slump in equities, increasing demand for the precious metal as an alternative investment.

The Dow Jones Industrial Average yesterday posted its biggest drop since April 20 after the U.S. unemployment rate rose to the highest in almost 26 years.

“The jobs data out of the U.S. is going to reignite fears among investors that the global economic recovery will be slower than expected,” said Ben Westmore, a minerals and energy economist at National Australia Bank Ltd. in Melbourne. “When investors become risk-averse they retreat out of equity markets and into gold.”

Bullion for immediate delivery rose 0.3 percent to $932.83 an ounce at 8:28 a.m. in Singapore. The precious metal is still down 0.7 percent this week. Gold for August delivery increased 0.2 percent to $933.10 on the New York Mercantile Exchange’s Comex unit.

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