Gold / Silver / Copper futures - weekly outlook: May 4 - 8

Investing.com - Gold prices ended Friday's session at a six-week low as traders monitored the direction of the dollar while speculating on the timing of a Federal Reserve rate hike.

On the Comex division of the New York Mercantile Exchange, gold futures for June delivery hit an intraday low of $1,168.40 a troy ounce, a level not seen since March 19, before ending at $1,174.50, down $7.90, or 0.67%.

On Thursday, gold plunged $27.60, or 2.28%, to settle at $1,182.40. For the week, prices of the precious metal declined 50 cents, or 0.04%, the third straight weekly loss.

Futures were likely to find support at $1,159.70, the low from March 19, and resistance at $1,214.60, the high from April 28.

The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, rose 0.53% on Friday to settle at 95.38. On Thursday, the index slumped to a nine-week low of 94.47.

The dollar regained ground on Friday amid signals that the U.S. economy may be stabilizing after a recent bout of weakness.

Reports on Friday showed that activity in the manufacturing sector was stable in April, after slowing in the five previous months, while consumer sentiment improved to its highest level since January last month.

On Thursday, weekly claims data showed that the number of Americans filing for jobless benefits fell to a 15-year low of 262,000 last week, fuelling optimism that the U.S. economy has turned a corner after a recent soft patch.

Data published Wednesday showed that the U.S. economy grew just 0.2% in the three months to March, slowing from 2.2% in the final quarter of 2014. It was the slowest rate of growth in a year.

Gold rallied to a three-week peak of $1,214.60 on Tuesday as concerns over the U.S. economic recovery prompted investors to push back expectations for higher U.S. interest rates.

But the Federal Reserve said in its rate statement on Wednesday that recent indications of a slowdown in growth were probably due to “transitory factors.”

Also on the Comex, silver futures for July delivery ended Friday's session at $16.13 a troy ounce, down 1.8 cents, or 0.11%. A day earlier, silver plummeted 54.9 cents, or 3.29%, to close at $16.15.

Despite Friday's losses, silver gained 39.5 cents, or 2.9%, on the week, snapping four consecutive weeks of losses.

Elsewhere in metals trading, copper for July delivery tacked on 4.3 cents, or 1.49%, on Friday to settle at $2.929 after hitting an intraday peak of $2.937, the most since December 15.

For the week, copper prices rallied 17.8 cents, or 6.39%, amid mounting speculation policymakers in China will have to introduce further stimulus measures to jumpstart the economy amid lackluster growth.

Since November, the People's Bank of China has introduced a series of stimulus measures, including lowering interest rates twice and cutting the reserve requirement ratios of major banks twice, in order to spur economic activity and boost growth.

The Asian nation is the world’s largest copper consumer, accounting for almost 40% of world consumption last year.

In the week ahead, investors will be focusing on Friday’s U.S. nonfarm payrolls report, for a fresh indication on the strength of the economic recovery.

Ahead of the coming week, Investing.com has compiled a list of these and other significant events likely to affect the markets.

Monday, May 4

Markets in Japan and in the U.K. are to remain closed for holidays. China is to release revised private sector data on manufacturing activity.

The euro area is to produce revised data on manufacturing activity, while the U.S. is to publish figures on factory orders.

Tuesday, May 5

Markets in Japan are to remain closed for a holiday.

The U.S. is to release data on the trade balance and construction sector activity, while the Institute of Supply Management is to release a report on U.S. service sector activity.

Wednesday, May 6

Markets in Japan are to remain closed for holidays. China is to produce private sector activity on service sector growth.

The U.S. is to release its monthly ADP nonfarm payrolls report and later in the day Fed Chair Janet Yellen is to speak at an event in Washington DC.

Thursday, May 7

The U.K. is to hold general elections.

The U.S. is to publish the weekly report on initial jobless claims.

Friday, May 8

The U.S. is to round up the week with what will be the closely watched government nonfarm payrolls report.