Gold prices tipped higher Friday but remained on track for a weekly loss as financial markets assessed a tentative North and South Korea peace pact and digested the first reading on first-quarter GDP, an historically soft patch for the U.S. economy.
Gold gained even as a leading dollar measure also rose and as rising Treasury yields steadied. Stock indicators pointed to a mixed open that looked to include earnings-led tech gains.
June gold GCM8, +0.34% rose $3.80, or 0.3%, to $1,321.60 an ounce. The contract settled Thursday at $1,317.90, which marked the lowest settlement for a most-active contract since March 20. June gold is on track for a roughly 1.3% drop for the week.
A reading on gross domestic product in the first quarter showed slowing growth, but not as much as Wall Street expected, as businesses stepped in where consumer spending cooled. A separate report could prove more sensitive for inflation-wary markets — it showed worker compensation rising at the fastest pace since 2008. The cost of labor rose 0.8% in first quarter, to bring yearly gain to 2.7%.
That data will be followed by the consumer sentiment index for April at 10 a.m. Eastern, with a reading of 98 expected.
Concerns over rapidly rising U.S. interest rates were still hanging over markets, as the yield on 10-year Treasury notes TMUBMUSD10Y, -0.40% recently traded at its highest since January 2014, pushing above the closely watched 3% line, in part of rising inflation concerns. On Friday, it stood at 2.975%. Rising Treasury yields tend to dull demand for nonyielding bullion, at least in the short term.
Read: Here’s why the stock market and commodities are no longer in lockstep
The ICE U.S. Dollar Index DXY, +0.21% was up 0.3% at 91.82. Its moves can influence appetite for dollar-priced commodities, including the yellow metal, to investors using other currencies.
Geopolitics remain in focus for the haven metals market after a historic meeting between North Korean leader Kim Jong Un and South Korean President Moon Jae-in. The two leaders signed a declaration that they will work toward a “complete denuclearization” of the Korean peninsula and agreed to formally end the Korean War with a peace treaty. The outcome of that gathering could lay the groundwork for Kim’s planned meeting with U.S. President Donald Trump.
“De-escalation in the geopolitics continues as South and North Korean leaders met for the first time ... President Trump must be appreciated for this, although it is a very different story if something else is going on behind the closed doors. Under those circumstances, we would see the risk-off rally skyrocketing because it will have a major impact on investor sentiment,” said Naeem Aslam, chief market analyst at Think Markets.
“The shining metal, for the time being, is trading in a range where the top side is capped by the resistance of $1,366 and the support is at $1,302,” said Aslam. “We need to break out of this ugly consolidation zone so a new trend could emerge and that would attract many traders who use technical analysis for their trading strategies.”
Elsewhere, investors may look ahead to next week’s trade talks between the U.S. and China in Beijing. Chinese tech stocks came under pressure on concerns more action could be taken against the sector.
Elsewhere in the metals market, May silver SIK8, -0.28% was little changed near $16.475 an ounce. June silver SIN8, -0.25% which is now the most-active contract, shed a penny, or 0.1%, to $16.550.
Read: Global economic growth was a blessing and curse for 2017 silver demand
May copper HGK8, -2.25% fell by 1.7% to $3.06 a pound, while the more active July contract HGN8, -2.25% fell 1.7% to $3.083. July platinum PLN8, +0.38% rose 0.1% to $911.11 an ounce.
June palladium PAM8, -0.51% was little changed at $978.65 an ounce. The contract trades up nearly 1% month to date despite pulling back sharply in recent sessions. U.S. tensions with Russia, which threaten global supplies, have recently fueled strong weekly gains.
The SPDR Gold Shares GLD, +0.21% exchange-traded fund gained 0.1% and the iShares Silver Trust SLV, -0.28% slipped 0.1%. The VanEck Vectors Gold Miners GDX, +0.38% rose 0.4%.