Industrial and Commercial Bank of China (601398, stock forum) paper gold saw mixed performance in early Asian trading on Thursday, April 9. On Wednesday, international spot gold opened at $1,646.50 per ounce in the Asian session, climbed as high as $1,656.20 per ounce, dipped to a low of $1,640.63 per ounce, and closed at $1,644.39 per ounce, down $2.01 or 0.12%. International spot silver opened at $15.01 per ounce in the Asian session on Wednesday, rose as high as $15.12 per ounce, fell to a low of $14.82 per ounce, and closed at $14.95 per ounce, down $0.03 or 0.20%.

Gold prices held steady on Wednesday, as markets anticipate that the U.S. COVID-19 outbreak is nearing its peak.

David Meger, head of metals trading at High Ridge Futures, said, “As governments around the world and central banks deploy helicopter money and stimulus packages to boost the economy, it’s essentially like a money-printing machine in action—creating a highly favorable environment for gold.”

U.S. stock market major indices opened higher for the third consecutive trading day, as markets anticipate that the coronavirus outbreak in the United States has nearly peaked and that Congress will pass additional relief measures to bolster the economy.

According to real-time data from Worldometers, the number of confirmed cases in the United States has exceeded 420,000, reaching 425,828, while the death toll has risen to 14,604. Globally, the total number of confirmed cases has climbed to 1,506,420, with 88,147 deaths.

U.S. President Donald Trump said on Tuesday that the United States may have already reached the peak of the coronavirus outbreak’s “curve,” and reiterated his hope that the U.S. economy will recover as soon as possible.

“America’s Zhong Nanshan,” Dr. Anthony Fauci, director of the U.S. National Institute of Allergy and Infectious Diseases, told Fox News on Wednesday that the number of coronavirus-related deaths in the United States is now lower than initially estimated, and noted that conditions should improve after this week. However, he added that efforts to combat the virus should be stepped up.

In Europe, the Italian government is drafting a plan that is expected to enable a full return to normal life within a few months. Some businesses and shops may reopen on April 13. The government may allow Italians to go outside and gradually return to offices starting May 4, while schools will remain closed until September.

Jim Wyckoff, senior analyst at Kitco Metals, said in a report: “The U.S. and Europe are hoping that the models suggesting next week will be the worst week in terms of new virus infections are correct—that is, that the infection curve will peak then.”

“From a technical standpoint, gold bulls enjoy a solid overall short-term technical advantage in an uptrend… This strongly suggests that, at least in the near term, the path of least resistance for prices remains sideways consolidation with a bias to the upside—and this could persist for an extended period.”

Market participants are also closely watching the OPEC and its allies’ meeting, which could result in further production cuts to support oil prices that have already fallen sharply.

Fundamental bullish factors

1. According to real-time data from Worldometers, the number of confirmed cases in the United States has exceeded 420,000, reaching 425,828; the death toll has risen to 14,604. Globally, the number of confirmed cases has climbed to 1,506,420, with 88,147 deaths.

Federal Reserve Governor Robert Kaplan projects that U.S. GDP could contract by 4% to 5% in 2020. The second quarter may see a GDP decline of 25% to 35%, followed by a recovery in the second half of the year. The unemployment rate is expected to peak at around 15% before falling to 7% to 8% by year-end. The financial and employment crises may prompt households to increase savings and reduce spending.

2. Data released by the U.S. Department of Labor on Friday, April 3, showed that nonfarm employment fell by 701,000 in March—only the beginning of the economic toll exacted by the coronavirus crisis. This marked the first decline in employment since September 2010 and brought the drop close to the peak of 800,000 recorded during the financial crisis in May 2009. The unemployment rate rose from 3.5% to 4.4%, its highest level since August 2017, as employers have only just begun cutting jobs while social-distancing measures aimed at curbing the spread of the virus have shut down large swaths of the U.S. economy. Another measure—tracking discouraged workers and those working part-time for economic reasons—jumped from 7% to 8.7%, the highest level since March 2017. Concurrent with the rise in the unemployment rate, the labor-force participation rate plunged to 62.7%, a decline of 0.7 percentage points and the lowest level since August 2018, after having trended steadily higher in the months leading up to this.

3. On Thursday, April 2, the U.S. Department of Labor reported that 6.648 million people filed for unemployment benefits in the week ending March 28, setting a new record. Economists expect that, as coronavirus-related shutdowns continue to spread across the country, another 4 million to 5 million workers will apply for unemployment benefits next week—with some estimates projecting as many as 9 million.

4. On Wednesday, April 1, the Institute for Supply Management (ISM) reported that the March manufacturing index fell below the 50.0 boom-bust threshold. The ISM manufacturing index declined from 50.1 in February to 49.1 in March. Data show that a sharp drop in new orders and output drove the contraction in economic activity, while prices in the sector also eased. Commentators note that although the decline in U.S. manufacturing activity in March was less severe than expected, the COVID-19 pandemic has pushed new orders for factories to an 11-year low, reinforcing the view that the U.S. economy is already in recession. The pandemic has not only disrupted supply chains but also dampened demand; transportation has all but come to a standstill, and restaurants, bars, and other social venues have been forced to close.

5. A report released on Wednesday, April 1, by ADP and Moody’s Analytics shows that U.S. businesses shed 27,000 jobs in early March, before the economic shutdown caused by the coronavirus reached its peak. Based on the millions who have already filed for unemployment benefits, the actual job losses this month are likely far more severe. The Wednesday report covers the period through March 12. Mark Zandi, Moody’s chief economist, said this marks the first decline in private-sector employment in a decade, and that total unemployment could rise by 10 million to 15 million. Speaking on a media conference call, Zandi stated: “Employment had been growing steadily for 10 consecutive years—until the virus put an end to that trend.”

6. U.S. consumer confidence has fallen to its lowest level since mid-2017, as government efforts to mitigate the coronavirus pandemic have led to widespread business closures and left millions of Americans unemployed. According to a report released Tuesday, March 31, by the Conference Board, the index dropped by 12.6 points—the largest decline since 2011—to 120. The median economist forecast had been for a drop to 110. The survey’s reference date was March 19.

Fundamental bearish factors

1. According to data from Johns Hopkins University, the daily increase in COVID-19 cases in the United States has declined since last Friday. Since then, the global daily case growth rate has also decreased.

An influential model that tracks the U.S. coronavirus pandemic now projects lower death tolls and reduced demand for hospital beds compared with last week’s estimates.

On Tuesday, the model projected that approximately 82,000 people would die from coronavirus disease by August. By Wednesday, this estimate had been revised downward to 60,415.

On Wednesday, April 8, Dr. Anthony Fauci, director of the U.S. National Institute of Allergy and Infectious Diseases, told Fox News that the number of coronavirus-related deaths in the United States is now lower than initially estimated, and noted that conditions should improve after this week. However, he added that efforts to combat the virus should be stepped up.

2. Italy announced on Tuesday, April 7, that confirmed COVID-19 cases had risen from 132,547 to 135,586, while the death toll increased by 604 to 17,127. The rate of new cases is the lowest since March 13.

On the 7th, local time, British Acting Prime Minister Dominic Raab stated that the government’s current “social distancing” measures are playing a crucial role, significantly reducing infection rates and hospital admissions to ensure that the National Health Service has sufficient capacity to cope with the existing patient load.

In recent days, the number of confirmed COVID-19 cases in the United States appears to have peaked and begun to decline. On Tuesday, New York Governor Andrew Cuomo reported that, although the state recorded its largest single-day increase in deaths, the number of patients hospitalized is falling.

In Asia, South Korea reported fewer than 50 new infections for the second consecutive day. As of April 6, China also recorded no new deaths, the first time this has occurred since daily updates began being released in January of this year. These two Asian countries were among those that experienced a sharp surge in infection rates early in the outbreak, with China reporting its first cases.

3. The Institute for Supply Management (ISM) reported that the nonmanufacturing index fell to 52.5 in March, better than the expected 43.0. It is clear, however, that this report may not fully capture the virus’s impact on the economy, suggesting that future data for the sector could be considerably worse. In a statement, ISM Chairman Anthony Nieves said: “Respondents are concerned about the coronavirus’s effects on supply chains, operational capacity, human resources, and finances, as well as its broader implications for the overall economy.”

4. On Monday, March 30, the National Association of Realtors (NAR) reported that pending home sales in the United States rose for the second consecutive month in February, with the existing-home sales index increasing 2.4% from the previous month to 111.5. According to NAR’s chief economist, February’s data do not yet reflect the significant impact of the COVID-19 pandemic; as layoffs mount and the economy enters a recession, the housing market could well lose momentum. Earlier this month, another set of data showed that U.S. existing-home sales climbed to a 13-year high in February.

5. On Monday, March 30, Michael Ryan, Executive Director of the World Health Organization’s Health Emergencies Program, stated that there is currently no effective treatment or medication for COVID-19; however, certain drugs used to treat HIV or other coronaviruses such as MERS and SARS may prove effective against the novel coronavirus. Some of these drugs may shorten the duration of the illness, while others may reduce its severity. Michael Ryan urged the continued acceleration of ongoing randomized controlled trials being conducted worldwide.

Key Focus for Thursday

08:30 Bank of Japan Governor Haruhiko Kuroda will deliver a speech.

14:00 Germany’s February Seasonally Adjusted Trade Balance

14:00 UK February Industrial Output and Goods Trade Balance

19:30 – The European Central Bank releases the minutes of its March monetary policy meeting.

20:30 U.S. March Producer Price Index

20:30 U.S. Seasonally Adjusted Initial Jobless Claims for Last Week

22:00 U.S. April University of Michigan Consumer Sentiment Index (Preliminary)

22:00 Federal Reserve Chair Jerome Powell to Deliver Remarks on the U.S. Economic Situation

22:00 OPEC+ Plans to Discuss New Cooperation at Its Meeting

Time to be determined: French President Macron delivers a national address.

At 4:00 a.m. the following day, San Francisco Fed President Daly will deliver a speech.