Thursday, January 31, 2013
Legend has it that a Civil War Union Captain uttered the words “They couldn’t hit the broad side of a barn” only to be struck down by a confederate bullet. Unfortunately for him, he was dealing with enemy combatants. Had he been speaking about economist and analysts who were tasked with predicting 2012’s 4th quarter GDP it might have been a different story…Ok, well he’d still be dead because it’s 150 years after the war but you get my point. Yesterday’s wiff took many by surprise and looked very supportive of the metals heading into the conclusion of the first FOMC meeting of the year. However, the Federal Reserve decided to keep the printing presses going (status quo) and while they say there is an end, under certain criteria, it doesn’t look like that criteria will be met any time soon. With QE infinity already baked into the market it was only natural for some profit taking to occur. As you can see, the precious complex is well in negative territory to start the day. Weekly jobless claims rose to 38,000 last week, not surprising since the few weeks following the Holiday’s tend to be volatile for that data. The more important reading, government jobs data, will be released tomorrow. Have a great day!
Wednesday, January 30, 2013
The precious complex is finding support as the greenback gets clobbered and the euro reaches $1.35 for the first time since early 2010 following reports that U.S. GDP contracted .1% in the final quarter of 2012. This data falls well short of the 1% increase that analysts were expecting and virtually guarantees that the printing presses will continue to print money like it’s going out of style. Gold is up more than 1% to 1678 after opening the day at $1661. Silver is the big gainer, so far, having jumped more than 2% to $31.85 and pressing higher. Platinum regained some lost ground as well following reports that Anglo has tabled plans to cut 14,000 jobs which had pressured the white metal lower to start the week. Palladium continues the march higher and now trades at $756.50. With this most recent curveball, Bernanke and his cohorts may have to re-evaluate any strategy they may have come up with during the first half of their two-day meeting which concludes this afternoon. ADP reported that private sector jobs added 192,000 people to the payroll, better than the 175,000 that was predicted. However, the ADP report is just the first of three barometers of the job market and will be followed by the weekly jobless claims numbers tomorrow and the more heavily anticipated government jobs data on Friday. Have a great day!
Tuesday, January 29, 2013
Recent sell-offs across much of the precious complex have provided some bargain-hunting opportunities that have the metals back on the north bound side of the commodities highway. Gold closed Monday’s session at $1652.90 and now trades .5% higher at $1661. Silver is up more than 1% to $31.115. Platinum took a haircut during the first session of the week as reports out of South Africa indicate Anglo is going to take a little more time to think about its restructuring plan that originally called for 14,000 job cuts. The white metal closed at $1662 but now sits mid-range on the day at $1674.60. Palladium is trading at $745. Market participants will take in some more earnings today as well as economic data on housing and consumer confidence. However, the main event, The first FOMC meeting of the year, will conclude tomorrow afternoon and investors will wait to see what the country’s economic brain trust has in store regarding the bond buying program. The most recent plans call for 6.5% unemployment or 2.5% inflation before the insanity ends but until then the printing presses continue. Have a great day!
Monday, January 28, 2013
The precious complex is softer from Friday’s close with the exception of palladium. The issue of shrinking Russian state stockpiles has reared its ugly head yet again and palladium looks well supported above its previous close and now trades at $742.50. Reports indicate that Russian palladium inventory sales were down 68% in 2012 from the previous year, according to JM. Platinum is trying to get back on track after giving back some of Friday’s late day gains. The white metal currently trades at $1685. Gold continues the trend downward following its most recent attempts to break through that pesky $1695 mark early last week. The yellow metal is currently hovering around its Friday close at $1655 and could remain rather quiet ahead of the FOMC meeting that concludes on Wednesday. The end of the week brings the heavily anticipated government non-farm payrolls. Have a great day!
Friday, January 25, 2013
Platinum and palladium are modestly softer from yesterdays close while the other half of the fantastic four, gold and silver, continue to leak oil heading into the end of the week. Gold’s failure to break through $1695 coupled with a better-than expected earnings season has knocked the yellow metal down roughly $30 from the weeks highs. Silver has followed suit and is down another .85% to start the session. The selling of perceived safe-havens has not spilled over into the PGM’s as sentiment seems to have shifted from “apocalyptic” to “not so bad” regarding the broader global economy as data seems to be giving investors hope that we’re slowly climbing out of the hole. Don’t worry, that should all change in a few months when U.S. lawmakers meet in the congressional octagon to fight over balancing the budget…again. December New home Sales are on tap for today as well as more corporate earnings which have, thus far, exceeded expectations and lent to the chipper mood on Wall St. Have a great day!
Wednesday, January 23, 2013
The precious complex continues to challenge new highs ahead of today’s vote, by the House of Representatives, to increase the debt ceiling and give the Treasury more time to borrow more money and push the country into deeper debt. Platinum was able to reach the psychological level of $1700 and maintains a modest footing just above at $1702. Gold hasn’t been able to find it’s way around the $1695 road block but looks supported above $1690 for the time being. Silver is up .5% to $32.365 while palladium has backtracked .5% to $726.40. Look for things to remain rather calm until the legislative brain trust cast their votes. Have a great day!
Tuesday, January 22, 2013
In a heavily anticipated move, the Bank of Japan announced their own brand of monetary easing overnight. However, the money printing won’t begin in earnest until 2014 giving market participants some time to strategize. Gold and palladium are virtually equal in early trading as platinum looks to be making another run at $1700. The white metal is now trading at $1687. Gold is only modestly lower despite reports that India has increased their gold import duty to 6%. The yellow metal is trading at $1688. The rest of the complex is relatively flat to start the first trading day of the week. The National Association of Realtors will announce new home sales numbers at 10:00 am EST. Afterwards, investors will continue to take in earnings reports. Have a great day!
Friday, January 18, 2013
Platinum was finally able to reach the $1700 threshold and, for a moment, hold that mark but resistance was plentiful. Despite some uncertainty about the mining situation in South Africa and a strong showing for 4th quarter/2012 Chinese GDP data, the white metal is down nearly 1% in the early part of the session. Palladium is modestly lower after reaching a high of $732.90 but looks well supported at its current level of $725.35 after Chinese GDP data indicated that the world’s #2 economy grew at 7.9% to round out the last quarter of 2012. Gold was able to brave the pressure from improved weekly jobless claims and positive housing data and now finds support following the Philly Fed index that came in at -5.8, indicating a contracting manufacturing sector in the mid-Atlantic. The yellow metal reached as high as $1695 and is now modestly softer at $1688. Consumer sentiment data will be reported at 10:00 am and one can’t expect it will show a positive outlook. Especially after the payroll tax-cut expired and those pesky post-holiday credit card bills start showing up in the mail. Have a great day!
Thursday, January 17, 2013
Platinum made an effort to regain the $1700 level yesterday on the back of fears surrounding a wildcat strike by miners at Amplats, The worlds #1 platinum producer had announced, earlier this week, some restructuring plans that included 14,000 job cuts. Needless to say, the workers weren’t exactly going to turn a blind eye but reports are that workers have returned to the mines ahead of union talks with Amplats management. Platinum has since retreated nearly .5% from yesterdays close and currently trades at $1687.The precious complex as a whole finds itself under some pressure this morning with gold having lost .7% to start the day and silver down more than 1%. Given the strong start to 2013 some profit taking is to be expected. First time jobless claims shrunk by 37,000 applicants but look for that number to go back up once employers clean house on seasonal employment. Chinese GDP data is scheduled to be released overnight which could lend some support to the metals. Have a great day!
Wednesday, January 16, 2013
The precious complex, with the exception of palladium, finds itself under pressure this morning as investors look to lock in profits following a strong start to 2013. While platinum was unable to sustain yesterday’s gains from the restructuring announcement at Amplat’s Rustenburg operation, the downside could be cushioned as workers at the world’s #1 platinum producer downed tools. The restructuring plan includes 14,000 job cuts and the miners are not happy about it, despite Amplat’s plan to create alternative employment. The white metal is down .75% to $1677 after having broken through the $1700 level yesterday. Gold remains cheaper than platinum for the time being as a softening euro drags the yellow metal nearly .5% from yesterday’s close. Gold is currently trading at $1675. U.S. Consumer Price Index showed little inflation pressure to end 2012 (1.7% for December) which should be enough for the Fed to keep the printing presses on. The Fed said inflation would need to breach 2.5% before any course correction would be entertained. Amidst the deluge of earnings reports the Federal Reserve’s Beige Book will be released at 2 p.m. EST. Have a great day!
Tuesday, January 15, 2013
The precious metals complex continues to press higher in early trading. However, you’ll notice that one metal clearly stands out from the rest. Platinum is up nearly 2% and at one point broke through the $1700 level as reports of mine closures at Amplats sent the white metal soaring. Anglo American Platinum, the world’s #1 platinum producer, announced the shuttering of four shafts at the company’s Rustenburg operation and their intention to sell-off a fifth mine. Production at the site is expected to be reduced by 400,000 t.o. per year. The shake-up has Platinum currently trading at $1691. In domestic news, the Commerce Department reported that retail sales increased by .5% to end 2012 with help from auto sales and the Labor Department said PPI fell .2% to end the year. Earnings season will be in full swing tomorrow so it’s unlikely that these economic reports will pull investors off the sidelines prematurely. Have a great day!
Monday, January 14, 2013
The metals complex is starting off the week on the upside on what should be a rather quiet day as investors gear up for earnings season which kicks off mid-week. Better Chinese economic data revealed last week and the stronger euro have provided good support following recent sharp sell-offs. Silver is the big gainer in early trading, up 1.5% to start the day. Platinum is following closely behind with a 1.30% gain thus far. The white metal is currently trading at $1653, just $12 cheaper than gold! Not too much on tap for today with regards to news. Have a great day!
Tuesday, January 8, 2013
Commodities are still looking for their identities in 2013. It’s been quite choppy trading so far this year with light volumes. The relief rally over the short term fix of the US fiscal resolution faded as prospects of debt ceiling and sequester debates in the coming months kept a lot of traders and investors on the sidelines. The Fed minutes from the last meeting pointed to rumblings about the QE infinity from some non-voting members; suggesting that QE should end in late 2013. These comments caused a selloff in commodities and will likely cap any upward momentum in precious metals until the next Fed Meeting at the end of the month. Gold and silver are locked in a struggle to hold $1650 and $30 respectively. We expect chopping trading conditions to continue this quarter and look for precious metals to trade higher on US and Global economic recovery later this year.
Thursday, January 3, 2013
ADP’s private sector jobs report and the government’s weekly jobless claims indicate that the employment picture remains murky at best. The private sector was shown to have added 215,000 people to the payrolls in the final month of 2012 and weekly jobless claims rose 10,000 to close out the year. If either of those reports are any indication of what to expect when the government jobs data is released tomorrow then we shouldn’t expect much. The unemployment rate currently stands 7.7%. Market participants are dealing with what some have coined the fiscal cliff “hangover”. The only problem is, this particular hangover can’t be alleviated with greasy breakfast food, some Gatorade and a couple of aspirin. The not-so-grand bargain amounted to nothing more than kicking the can down the road as the deal did nothing to address the more important concern of government spending gone wild. This has led many to reconsider the knee-jerk reaction of the risk-on mentality that ensued yesterday. The precious complex is a mixed bag in early trading. Gold failed to hold yesterday’s gains and has slid more than .5% to start the day. The yellow metal is trading at $1677. Palladium has been the big loser thus far, sliding more than 1.25% and breaking through $700 to the downside. Palladium currently sits at $698 but perhaps auto sales figures could lend some support when they are released later today. The FOMC minutes will be released this afternoon. During the last meeting the Fed indicated it would stay the current course so long as unemployment remained above 6.5% or if inflation rises above 2.5%. Have a great day!