Below is a sample of our Daily Commentary. To get this comment, and our daily coverage of 15 additional markets and trade ideas, visit futures-research.com for your free 2 week trial!
OUTSIDE MARKET DEVELOPMENTS: Equity markets in Asia were lower, but European and US stock indices have reversed overnight losses and have moved higher. The Dollar has been slightly higher this morning, mainly against European currencies. The German Parliament approved the EU debt rescue package this morning. Also EU Finance Ministers will discuss tightening budget rules and improving economic policy coordination today. The Bank of Japan announced a new loan scheme for growth industries, while keeping Japanese interest rates unchanged. German first quarter GDP was up 0.2%, in line with expectations. The German IFO Business Confidence index however came in lower than expected at 101.5. UK Public Sector borrowing for April was 10 billion Pounds, lower than expectations. The Euro Zone balance of payments for March was a 1.2 billion surplus, higher than forecast. There are no major US economic numbers due in this morning.
GOLD MARKET FUNDAMENTALS: The bear camp will probably point to the initial weakness overnight as a sign that they retain control, while the bull camp will suggest that most of the declines were reversed ahead of the US Friday morning action. It is possible that news of a favorable vote in the lower German House on the EU Stabilization plan provided gold and other physical commodity markets with a slight lift. However, with equities seemingly unable to hold initial gains in the wake of the German political news, it would seem like the slow growth or deflation view is still lingering in some markets this morning. At least in the early action today, it would appear that flight to quality fears have remained a partial negative to gold prices, but some players think that coordinated intervention in the currency markets might be seen in the coming trading sessions and given the action in gold this week, intervention might be something that the bull camp hopes to see. However, ongoing weakness in energies and other physical commodity markets this morning seems to be emboldening the bear camp. Comex Gold Stocks were 10.541 million ounces up 64,043 ounces.
SILVER MARKET FUNDAMENTALS: The silver market seemingly outperformed the gold market in the overnight action, as silver avoided a fresh new low for the move. July silver also comes into the Friday US trade sitting initially above the prior closing value. The bull camp in silver might also suggest that silver is seeing some minor outside market support from ongoing gains in the copper market but that influence is partially tempered because of noted weakness in the platinum market. The silver market did see news of an increase in silver production from a minor silver producer and therefore the impact off the supply side of the equation this morning is probably very limited. It would appear that silver continues to garner a significant amount of direction from the equity markets and that suggests silver is still focused on its classic physical commodity market fundamentals and not on flight to quality issues. Comex Silver Stocks were 117.171 million ounces down 49,894 ounces.
PLATINUM: Weakness in the platinum market this week was partially the result of fears of a return to a global recession and part of the slide was the result of weak handed longs in futures and weak handed ETF longs being forced from the market. In retrospect platinum prices were at historically high levels and they were expecting and needing strong investment demand and a favorable economy. We suspect that the market has now removed some of the favorable economy portion of platinum pricing and that leaves the market capable of respecting the consolidation lows above the $1,450 level in July platinum.
Metals Market Commentary – 2010.05.21
by Dave Hightower on May 21, 2010
Below is a sample of our Daily Commentary. To get this comment, and our daily coverage of 15 additional markets and trade ideas, visit futures-research.com for your free 2 week trial!
OUTSIDE MARKET DEVELOPMENTS: Equity markets in Asia were lower, but European and US stock indices have reversed overnight losses and have moved higher. The Dollar has been slightly higher this morning, mainly against European currencies. The German Parliament approved the EU debt rescue package this morning. Also EU Finance Ministers will discuss tightening budget rules and improving economic policy coordination today. The Bank of Japan announced a new loan scheme for growth industries, while keeping Japanese interest rates unchanged. German first quarter GDP was up 0.2%, in line with expectations. The German IFO Business Confidence index however came in lower than expected at 101.5. UK Public Sector borrowing for April was 10 billion Pounds, lower than expectations. The Euro Zone balance of payments for March was a 1.2 billion surplus, higher than forecast. There are no major US economic numbers due in this morning.
GOLD MARKET FUNDAMENTALS: The bear camp will probably point to the initial weakness overnight as a sign that they retain control, while the bull camp will suggest that most of the declines were reversed ahead of the US Friday morning action. It is possible that news of a favorable vote in the lower German House on the EU Stabilization plan provided gold and other physical commodity markets with a slight lift. However, with equities seemingly unable to hold initial gains in the wake of the German political news, it would seem like the slow growth or deflation view is still lingering in some markets this morning. At least in the early action today, it would appear that flight to quality fears have remained a partial negative to gold prices, but some players think that coordinated intervention in the currency markets might be seen in the coming trading sessions and given the action in gold this week, intervention might be something that the bull camp hopes to see. However, ongoing weakness in energies and other physical commodity markets this morning seems to be emboldening the bear camp. Comex Gold Stocks were 10.541 million ounces up 64,043 ounces.
SILVER MARKET FUNDAMENTALS: The silver market seemingly outperformed the gold market in the overnight action, as silver avoided a fresh new low for the move. July silver also comes into the Friday US trade sitting initially above the prior closing value. The bull camp in silver might also suggest that silver is seeing some minor outside market support from ongoing gains in the copper market but that influence is partially tempered because of noted weakness in the platinum market. The silver market did see news of an increase in silver production from a minor silver producer and therefore the impact off the supply side of the equation this morning is probably very limited. It would appear that silver continues to garner a significant amount of direction from the equity markets and that suggests silver is still focused on its classic physical commodity market fundamentals and not on flight to quality issues. Comex Silver Stocks were 117.171 million ounces down 49,894 ounces.
PLATINUM: Weakness in the platinum market this week was partially the result of fears of a return to a global recession and part of the slide was the result of weak handed longs in futures and weak handed ETF longs being forced from the market. In retrospect platinum prices were at historically high levels and they were expecting and needing strong investment demand and a favorable economy. We suspect that the market has now removed some of the favorable economy portion of platinum pricing and that leaves the market capable of respecting the consolidation lows above the $1,450 level in July platinum.
Tags: Gold, Metals, Platinum, Silver
About Dave Hightower