(Kitco NewsWire) - Spot gold and silver prices were higher in late U.S. trading Tuesday, as Treasury yields eased from multi-decade highs and the U.S. dollar pulled back, giving metals room to extend their post-payroll rebound. At the time of writing, spot gold was trading near $4,165.40 an ounce, up 0.63% on the session, while spot silver was trading near $61.260, up 0.53%.
North American equities closed higher as AI-linked earnings optimism and lower yields offset lingering inflation concerns. The S&P 500 rose 44.98 points, or 0.6%, to a record 7,818.93. The Dow Jones Industrial Average gained 253.38 points, or 0.5%, to 51,521.28. The Nasdaq Composite added 122.48 points, or 0.4%, to a record 27,599.79, while the Russell 2000 fell 16.84 points, or 0.6%, to 2,830.30.
European equities also finished higher as bond yields eased and crude prices retreated from recent highs. The Stoxx Europe 600 rose 3.01 points, or 0.48%, to 636.63. Germany’s DAX gained 194.98 points, or 0.77%, to 25,449.19, the U.K. FTSE 100 added 43.75 points, or 0.42%, to 10,541.69, France’s CAC 40 rose 30.97 points, or 0.40%, to 7,865.07 and Italy’s FTSE MIB climbed 443.02 points, or 0.87%, to 51,261.40.
Market positioning remains less hawkish at the front end but still defensive at the long end. September payrolls rose by only 29,000, the unemployment rate held at 4.2%, average hourly earnings rose 0.1% on the month and July and August payrolls were revised down by a combined 60,000 jobs. Monday’s services data kept the inflation side of the trade alive, with the ISM services prices index rising to 74.0, its highest level since July 2022, even as the headline services PMI eased to 54.9. Fed funds pricing put the probability of an October hike near 19% to 23%, while December still carried a materially higher probability of at least one additional increase. The 10-year Treasury yield fell to the 5.27% area, the 2-year yield eased toward 4.79% and the dollar index retreated from Monday’s high but remained firm.
The next rate-path tests are Wednesday’s September Fed minutes at 2:00 p.m. ET, weekly jobless claims Thursday at 8:30 a.m. ET and preliminary October consumer sentiment Friday at 10:00 a.m. ET. Softer labor or sentiment data would support gold by validating the payroll slowdown; firmer inflation expectations or hawkish minutes would keep the yield channel pointed against bullion.
The Strait of Hormuz and U.S.-Iran situation remains a supply-risk overhang, but Tuesday’s market impact was less inflationary as crude flows continued to recover. Gulf oil flows excluding Iran have returned to more than 81% of pre-war levels, while Middle East producers are using alternative export routes and ship-to-ship transfers to keep barrels moving. The Group of Seven’s planned 100 million-barrel emergency stock release and improving Saudi flows have also cooled the immediate blockade premium. Still, the risk has not cleared: U.S. energy officials raised fourth-quarter Brent price forecasts, tight diesel supplies remain a pressure point and tanker-security risks around Hormuz and nearby shipping lanes continue to elevate insurance, routing and logistics costs. Brent crude traded near $100.58 a barrel, while WTI was near $89.44. Lower crude and lower yields helped gold and equities on the session, but the unresolved shipping backdrop keeps a defensive bid under bullion and leaves energy inflation inside the Fed reaction function.
The key outside markets see Nymex WTI crude oil prices little changed and trading near $89.44 a barrel, while Brent crude was near $100.58. The yield on the benchmark 10-year U.S. Treasury note is trading near the 5.3% area. The U.S. dollar index is softer but still elevated. (Kitco Global Index shows how much of today's gold move is the dollar versus the gold market itself.)
Technically, spot gold bulls’ next upside price objective is to push prices back above the $4,180.00 to $4,190.00 resistance zone, with a sustained move targeting $4,214.00 and then $4,238.00. Bears’ next near-term downside price objective is a break below $4,142.71, with deeper downside targets at $4,114.97 and then the $4,000.00 to $4,020.00 range. First resistance is seen at $4,180.00 and then at $4,190.00. First support is seen at $4,162.06 and then at $4,142.71.
Spot silver bulls’ next upside price objective is to drive prices back above the $61.756 to $62.090 area, with a move above that zone targeting $62.980 and then the 50-day moving average near $64.170. The next downside price objective for the bears is a break below $60.835, with deeper downside targets at $59.690 and then the $56.560 to $54.780 range. First resistance is seen at $61.756 and then at $62.090. Next support is seen at $60.835 and then at $59.690.
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