-- Posted 26 March, 2008 | Digg This Article | Discuss This Article - Comments:

The Metals:

Gold fell to $934.37 by late trade in Asia before it rose to as high as $951.80 by noon EST and then fell back off slightly in afternoon trade, but it still ended near that session high with a respectable gain of 1.5%.  Silver fell to $17.64 by late trade in Asia, but it then rose to as high as $18.33 by late trade in New York and closed near that high with a gain of 3%.

Euro gold rose near €602, platinum gained $30 to $1990, and copper gained roughly 5 cents to about $3.75.

Gold and silver equities rose over 1% at the open and remained at about that level in morning trade before dipped slightly in early afternoon trade, but they then rallied back higher into the close and ended with about 2% gains.

The Economy:

New Home Sales fell to a 13 year low, but they did come in slightly higher than expected and somewhat offset the much worse than expected Durable Goods data.  Also making economic news today were some comments from treasury secretary Paulson who cautioned that the fed’s recent policy of opening the discount window to investment banks may not necessarily be permanent and instead sets a precedent only for unusual periods of turmoil.

The Markets:

Charts Courtesy of http://finance.yahoo.com/

Oil rose over 4% on a weaker dollar, a 24-hour strike in France, and poorer than expected inventory reports.  Crude inventories were unchanged, gasoline inventories fell 3.3 million barrels, distillates fell 2.2 million barrels, and refinery runs fell 1.6% to 82.2%.

The U.S. dollar index fell as poor economic data in the US made it more likely the fed will continue to cut interest rates while a strong German business sentiment survey made it more likely that the European Central Bank will not lower interest rates as many have been looking for.

Treasuries rose on the short end on poor economic data and on a $28 billion 2-year note auction that came off at a yield of 1.761%, but longer dated bonds fell as investors shunned the idea of loaning the government money for such a long time at current low yields.

The Dow, Nasdaq, and S&P fell on poor economic data that raised recession worries.

Among the big names making news in the market today were Tata and Ford, Motorola, Take-Two and Electronic Arts, Citigroup, and Clear Channel.

The Commentary:

“Several factors were working in gold’s favor in today’s session, most notably the weaker dollar and a stronger crude price. I have to admit, that I have been surprised by the sheer rapidity at which the support under the dollar has evaporated. It would seem traders finally woke up and asked themselves the same question I have been asking since last week, “What exactly is it that Bernanke and company did that was supposedly so dollar friendly?” The answer to that question is “nothing”. If anything, they undercut the dollar as they have promised endless mountains of liquidity and lower interest rates, something from which my understanding of currency valuation never bodes well for one’s domestic currency unit. As it now stands, the dollar is less than a full point away from its contract low.” - Dan Norcini, More at JSMineset.com

“April Gold finished up 14.2 at 949.2, 3.3 off the high and 8.3 up from the low.

May Silver closed up 0.583 at 18.383. This was 0.493 up from the low and 0.007 off the high.

The gold market extended gains this session garnering support from further weakness in the Dollar and a sharp rally in energy prices prompting investors to buy gold as an inflation hedge. Weak readings for Feb durable goods and Feb new home sales has raised the odds of another Fed rate cut which certainly supports the bull case in gold. On going concerns in the credit markets and the renewed weakness in the Dollar seems to be driving investors back to physical commodity markets after last week's sell off and that is certainly benefiting gold. The gold market also seems to be garnering some support from ideas that last week's sell off was over done.

The silver market registered sharp gains also finding support from the slide in the Dollar which seems to be redirecting fund buyers back to the physical commodity markets after last week's exit. The silver market easily shrugged off the weak economic news and with oil prices surging, it seemed as stagflation concerns were driving investors back to silver. Rising expectations for the Fed to cut interest rates again seems to be offsetting concerns the US economy is sliding toward a recession. Seeing solid gains in gold and copper also helped to underpin silver prices as well.”- The Hightower Report, Futures Analysis and Forecasting

GATA Posts:

A correction

'Securitization, insolvency, stagflation' is CMRE spring meeting's theme

Jeff Randall: When going gets rough, banks yell for nanny

Hoarding by banks stokes fears on credit crisis

Citigroup slams Bank of England for risking damage to real economy

Andrew Sorkin: Fed strong-armed Bear deal with deception, rule breaking

John P. Hussman: Bear's bondholders, not public, should pay

The Statistics:

As of close of business: 3/24/2008

Global Gold ETF Holdings

[WGC Sponsored ETF’s]

Note: Change in Total Tonnes from yesterday’s data: The ASX added 0.35 tonnes and the JSE added 0.12 tonnes.

COMEX Gold Trust (IAU)

Note: No change in Total Tonnes from yesterday’s data.

Silver Trust (SLV)

Note: No change in Total Tonnes from yesterday’s data.

The Stocks:

Yamana’s (AUY) fourth-quarter results, Exeter’s (XRA) closed financing and drill results, NovaGold’s (NG) closed public offering, ITH’s (THM) property acquisition, Apollo Gold’s (AGT) LOI to acquire a stock mill, Northgate’s (NXG) MOU with Matachewan First Nation, Fortuna’s (FVI.V) exercised warrants, U.S. Silver’s (USA.V) hiring of geologists, and Silvercorp’s (SVM.TO) normal course issuer bid were among the big stories in the gold and silver mining industry making headlines today.

WINNERS

LOSERS

Winners & Losers tracks NYSE and AMEX listed gold and silver mining stocks that trade over $1.

All of today's gold and silver stock news:

MPH Ventures Reports Significant Strike Extensions at Pidgeon Molybdenum Deposit in NW Ontario - More
- March 26, 2008 | Item | E-mail

Metalore Resources Limited - News Release - More
- March 26, 2008 | Item | E-mail

Fortuna Warrants Exercised - "Fortuna Silver Mines Inc. (CDNX:FVI.V - News): Jorge Ganoza, the President of Fortuna Silver Mines, is pleased to announce that, since the beginning of the year 4.37-million outstanding share purchase warrants, with an exercise price of $1.85, have been exercised for cash proceeds to the Company of approximately CDN$8.1-million dollars." More
- March 26, 2008 | Item | E-mail

GBS Gold Appoints Peter Breese as President & CEO - More
- March 26, 2008 | Item | E-mail

Landore Resources Limited (AIM Ticker: LND.L) - West Graham - First Nickel Option Drilling Update - More
- March 26, 2008 | Item | E-mail

Landore Resources Limited - Junior Lake-VW Nickel Project Resource Upgrade Statement - More
- March 26, 2008 | Item | E-mail

Noront Resources Commences Work Programme on Hawk 50/50 JV Property-"Ring of Fire" Area, McFaulds Lake - More
- March 26, 2008 | Item | E-mail

Exeter Closes $35 Million Financing - "Exeter Resource Corporation (CDNX:XRC.V - News)(AMEX:XRA - News)(Frankfurt:EXB.F - News) ("Exeter" or the "Company") announces that it has closed the private placement of 7,780,000 special warrants at a price of C$4.50 per special warrant announced on March 6, 2008. The offering was conducted by a syndicate of underwriters led by Canaccord Capital Corporation and BMO Capital Markets and including National Bank Financial, Dundee Securities and Haywood Securities. The Company raised gross proceeds of C$35,010,000." More
- March 26, 2008 | Item | E-mail