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Daily Gold & Silver Market Report – 12/05/2016

GOLD IS DOWN DUE TO ITALY’S REFERENDUM

As European equities strengthened Monday following investors shrugging off worries of Italian political instability, Gold fell more than 1 percent. Clara Denina with Reuters said, “Spot Gold fell by as much as 1.2 percent to a session low of $1,162.35 an ounce, within sight of a 10-month low of $1,160.38 hit last week, and was down 0.7 percent at $1,169.29 by 1302 GMT. U.S. Gold futures shed $7.80 to $1,170.10.” After Italian Prime Minister Matteo Renzi said Sunday he would resign, the euro recovered from an earlier two-year low against the U.S. dollar. However, the yellow metal remained pressured by stronger European shares, as investors expect the European Central Bank to step in if needed. Denina stated that, “Higher appetite for risk curbs the appeal of assets viewed as safer, such as Gold.” Gold fell more than 8 percent in November on a boosted dollar and Treasury yields following the surprising election of Donald Trump and his promise to increase growth and inflation with infrastructure spending. Following Gold’s decline, Silver dropped 0.4 percent to $16.66 an ounce. Platinum rose 0.1 percent to $929.30 an ounce while Palladium was down 1.1 percent to $731 an ounce.

SILVER PRICES RECOVER

There was a sharp rally in Silver prices, and Precious Metals in general, after U.S. employment data led to a significant decline in bond yields. Tim Clayton from Economic Calendar.com said that “…Silver drifted lower late in the U.S. session on Thursday and continued the trend in Asia on Friday with a move to $16.60 [per ounce] in tight ranges. There was further selling interest in Europe with a retreat to $16.40 despite a slightly weaker dollar tone and modest pullback in bond yields.” Further surprise came from other metrics, including the U.S. unemployment rate dropping from 4.9 percent to 4.6 percent, its lowest since mid-2007, increasing speculation the economy is at full employment. Clayton said, “The average earnings data was weaker than expected with a 0.1 [percent] decline on the month, which lowered the annual increase to 2.5 [percent] from 2.8 [percent] and compared with the consensus forecast of a steady rate of 2.8 [percent],” which could be due to the effects of the calendar. “After initial choppy trading, Silver pushed sharply higher as bond yields continued to decline with a rally in Gold prices also boosting confidence in Silver as it pushed to highs above $16.80 and registered a small gain for the week as a whole,” Clayton stated. The Italian referendum scheduled for early this week, and the reactions following, will be watched closely.

OIL DEMAND ON THE RISE

Although recently agreed production cuts could raise oil prices, the Organization of the Petroleum Exporting Countries (OPEC) expects the 2017 oil demand to be as strong as 2016. Promit Mukherjee and Sudarshan Varadhan with Reuters wrote OPEC is “looking to reduce production by about 1.2 million barrels per day [bpd] beginning in January to try and reduce global oversupply and prop up prices.” OPEC Secretary General Mohammed Sanusi Barkindo said OPEC has invited non-OPEC countries such as Russia, Columbia, Egypt, Mexico, Trinidad and many more to a meeting December 10 to discuss their support.  Mukherjee and Varadhan write, “Oil prices have risen since the production agreement, with benchmark Brent crude oil futures soaring on Monday to its highest since July 6, 2015 to $55.20 a barrel.” With that being said, many buyers such as India, who imports more than 80 percent of its crude oil, are starting to get worried. Barkindo said OPEC members were heavily invested in ensuring supplies would be able to meet global demand. Although it is many years from now, OPEC estimated that world oil demand will rise by 17 million barrels per day to approximately 110 million by 2040.

At 11:41 A.M. (ET), the APMEX Precious Metals spot prices were:

  • Gold, $1,214.80 Down $9.60
  • Silver, $16.64 Down $0.05
  • Platinum, $931.00 Up $3.00
  • Palladium, $726.00 Up $4.30

APMEX’s Account Managers now have extended hours Mondays through Thursdays and are here to serve you until 8 p.m. (EDT)! Or call us Fridays until 6 p.m. (EDT)! If you have any questions about investing in Precious Metals or simply would prefer to place your order by telephone, we are here to help.

Daily Gold & Silver Market Report – 12/02/2016

SILVER PRICES LOWER DUE TO HIGHER BOND YIELDS

Tim Clayton from EconomicCalendar.com says higher oil prices have supported Silver, with prices consolidating around $16.70 per ounce Wednesday. With WTI advancing by nearly 8 percent as OPEC agreed to cut production levels, oil prices improved in Europe. Gains in industrial commodities supported Silver prices, but those gains were offset by a development in bond yields and a generally strong U.S. dollar, while equities also progressed. Before a sharp drop, Silver briefly touched $16.80 per ounce early in the U.S. trading. Clayton stated, “USD/JPY advanced strongly to near 114.50, the highest level for close to nine months and there was further upward pressure on bond yields.” The impact on Silver was amplified by downward pressure on Gold, which fell below the important $1,180 per ounce support level. Trends relating to both the dollar and bond yields will be monitored as the U.S. Institute of Supply Management manufacturing data is due Thursday ahead of Friday’s employment report. In addition to that, the oil-market dynamics will also continue to guide overall market movements and Silver developments.

GOLD TEST THE SUPPORT WITH NFP

As a result of the strengthening U.S. dollar since the presidential election, Gold prices have turned bearish. FxPro Blog Technical Analyst Devata Tseng said Wednesday’s “better-than-expected U.S. economic figures” weighed on Gold prices, breaking the $1,180 per ounce support level. Gold spot hit its lowest level since February at $1,160.53 per ounce, though it stayed above the $1,160 support level. November’s non-farm payroll and unemployment figures will likely test the support level, with lower-than-expected figures helping Gold spot rebound and better-than-expected figures weighing on the yellow metal. Tseng went on to say, “The current trend of Gold still remains bearish, the price is trading below both the short term and long term moving averages and has been moving along the lower band of the Bollinger Band Indicator. The price is likely to hold temporarily above the support line at [$1,150 per ounce], yet the upside selling pressure is heavy.”

RALLY ON WALL STREET

Ever since the unexpected election of Donald Trump, major indexes are hitting record levels as investors anticipate him to promote policies that would spur economic growth. Sara Sjolin with MarketWatch said, “The uncertainty was underlined by the November jobs report, which showed 178,000 jobs added in the month, fewer than had been expected, while the count over the prior two months was revised lower. The jobless rate fell sharply, to a nine-year low of 4.6%.” The number of new jobs suggests a moderation in growth, although not enough to influence the expectation of a December interest rate increase from the Federal Reserve. Chief investment strategist Bruce McCain at Key Private Bank says that “The market has been rising on expectations that things will get better in terms of government policy. … It is safe to say we’ve come too far too fast, even while the trajectory is still there.” Sjolin closed with some data stating, “The S&P 500 is down 0.7% while Nasdaq … is down 2.3%, on track for its worst weekly decline the one before the November 8th election, according to FactSet data. The Dow is up 0.2%; the blue-chip index closed at a record Thursday.”

At 1:48 P.M. (ET), the APMEX Precious Metals spot prices were:

  • Gold, $1,214.80 Up $7.60
  • Silver, $16.64 Up $0.29
  • Platinum, $931.00 Up $18.70
  • Palladium, $726.00 Down $6.70

APMEX’s Account Managers now have extended hours Mondays through Thursdays and are here to serve you until 8 p.m. (EDT)! Or call us Fridays until 6 p.m. (EDT)! If you have any questions about investing in Precious Metals or simply would prefer to place your order by telephone, we are here to help.

Daily Gold & Silver Market Report – 12/01/2016

STEALING FROM SANTA?

CFRA Research strategist Sam Stovall says President-elect Donald Trump might be “stealing from Santa”! In other words, typically December is a good month for stocks; however, the market’s Christmas came early with the November Trump rally. Stock Trader’s Almanac editor Jeff Hirsch thinks the most likely reason for typical declines in December’s first half is due to investors selling losers to offset capital-gains taxes on winners. Therefore, buying during any first-half dip usually results in a solid profit by the new year. Jani Ziedins with CrackedMarket feels news from the OPEC deal should have unleashed a flood of buying. “If the market was a coiled spring ready to explode higher, this would have triggered that move,” he writes. “Instead we hit our head on the ceiling and fell into a tailspin.” Ziedins goes on to state “we’re stuck in a market that won’t break down on bearish news” but yet it “won’t rally on bullish news”. With that being said, Ziedins isn’t ready to call the bull-market dead, but also feels because of this week’s poor price-action we aren’t ready to extend the breakout into the record highs yet.

SILVER PRICES LOWER AS THE DOLLAR REDEEMS STABILITY

As the U.S. dollar regained strength following three consecutive declines, Silver prices declined alongside other metals Wednesday. After declining more than 9 percent since the November presidential election, the grey metal is attempting its fourth-consecutive increase after a five-month low last week. Gold prices, which were also pressured Wednesday, were on their second-consecutive drop; Sam Bourgi from EconomicCalendar.com says “the February futures prices fell $4.80, or 0.4%, to $1,186.00 a troy ounce.” The dollar index rose 0.2% to 101.17 after a sharp decline against other currencies the previous season. As investors turn their attention to the U.S. jobs data, Bourgi states the “greenback will see plenty of action in the latter half of the week.” According to the CME Group’s FedWatch Tool, the certainty for a December rate hike is currently priced at well over 90 percent. Bourgi closed by stating that “[oil] prices are on track for their biggest one-day gain since April”.

PALLADIUM IMPRESSING MANY

It’s no secret much of the world has experienced change since the November 8 presidential election. Not only did most pollsters get the election wrong, but analysts also got the market’s reaction to the election wrong. Many world leaders expected Hillary Clinton to win, so the election of Donald Trump was not the result they were wanting. Options analyst Andrew Hecht wrote that, “At the end of the campaign season, it appeared that a surprise in the U.S. that mirrored the post-Brexit markets would create more fear and uncertainty for the future. However, the bearish price action in precious metals markets since election night has been a shocker to many.” Meanwhile, Palladium has bucked the recent declining Precious Metals trend and is at its highest level since June 2015.

At 12:37 P.M. (ET), the APMEX Precious Metals spot prices were:

  • Gold, $1,214.80 Down $7.00
  • Silver, $16.64 Up $0.01
  • Platinum, $931.00 Down $1.70
  • Palladium, $726.00 Down $21.40

APMEX’s Account Managers now have extended hours Mondays through Thursdays and are here to serve you until 8 p.m. (EDT)! Or call us Fridays until 6 p.m. (EDT)! If you have any questions about investing in Precious Metals or simply would prefer to place your order by telephone, we are here to help.

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