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Gold Seeker Closing Report: Gold and Silver Fall Roughly 1% But Gain In After Hours Trade

By: Chris Mullen, Gold-Seeker.com


-- Posted 3 February, 2009 | | Source: SilverSeek.com

 

Close

Gain/Loss

Gold

$890.60

-$13.30

Silver

$12.30

-$0.07

XAU

119.85

+0.11%

HUI

290.26

+0.32%

GDM

911.90

+0.70%

JSE Gold

2594.04

-21.24

USD

84.88

-1.09

Euro

130.39

+2.11

Yen

112.03

+0.23

Oil

$40.78

+$0.70

10-Year

2.842%

+0.123

T-Bond

126.96875

-1.796875

Dow

8078.36

+1.78%

Nasdaq

1516.30

+1.46%

S&P

838.51

+1.58%

 
 

 

The Metals:

 

Gold rose as much as $8.60 to $912.50 by about 9AM EST before it fell to $889.02 by around noon and then bounced back higher in early afternoon trade, but it then fell back near its earlier low in the last minutes of trade and ended with a loss of 1.47%.  Silver climbed $0.115 to $12.485 and fell to as low as $12.15 before it also bounced back higher and closed with a loss of 0.56%.  Both metals have, however, climbed over 1% from their closes in after hours access trade at the time of writing.

 

Euro gold fell to about €691, platinum lost $13 to $956, and copper rose over 9 cents to about $1.52.

 

Gold and silver equities rose over 2% by late morning before they fell to see slight losses midday as the metals dropped, but they then rallied back higher into the close and ended with slight gains on the day.

 

The Economy:

 

Report

For

Reading

Expected

Previous

Pending Home Sales

Dec

6.3%

0.0%

-3.7%

 

Tomorrow at 8:15AM EST is the ADP Employment report for January expected at -515,000 and at 10AM is the ISM Services report for January expected at 39.0.

 

The Markets:

 

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

 

Oil prices rose on Tuesday after OPEC signaled it might deepen its record output cuts to help boost prices and drain bloated stockpiles.”

 

The U.S. dollar index fell with treasuries as the Dow, Nasdaq, and S&P rose over 1% on hopes for an economic recovery as Pending Home Sales came in much better than expected and earnings reports were decent overall.

 

Among the big names making news in the market today were Ford, BP, Merck, Schering-Plough, Dow Chemical, GMAC, Citigroup, Motorola, UPS, Avon, and GM.

 

The Commentary:

 

Dear CIGAs,

 

I wish I could blithely write cogent explanations day in and day out for what is transpiring in these markets and bring light into the murkiness, but alas, even after being involved in them on a daily basis for as many years as I have been, there are times when I admit that I haven’t a clue as to what is taking place or why. Today is one of those days.

 

A couple of things started the ball rolling today. First was the housing numbers data which surprised by coming in stronger than expected. That put a bid into equities for a while but the main effect was that it brought back the “risk” trades. Keep in mind something I said just a short time ago – one day risk is in, the next day it is completely out. All the convulsions we are watching these markets go through, especially in the Forex arena, is the result of hedge funds blasting in or blowing out from one day to the next. For today at least, Blue Horseshoe loves risk so the Dollar was promptly whacked lower along with Treasuries and money flowed back into the majors. The Australian Dollar was particularly strong as was the Euro. The Swiss Franc was also sharply higher, something that one does not normally expect to see when “risk” is in.

 

My view is that some of what we saw in the Forex markets was the result of the news that the Fed had extended the deadlines for currency swaps to October 30 of this year with 13 other Central Banks. No doubt this move was intended to meet dollar liquidity needs overseas as investors angrily dumped the worthless crap that Wall Street had peddled them. It is my opinion that the US monetary authorities DO NOT WANT a stronger Dollar, protestations to the contrary. Our agricultural exports have been shriveling up as the move up in the Dollar has been an effective price hike on foreign buyers at EXACTLY the wrong time. AG exports were the ONE PART of our economy which has been a shining beacon and that has been effectively mangled by the Dollar’s rise. At a time in which every nation on the planet is going to play the competitive currency devaluation game, why would we expect to see the US do anything differently than the rest? Yes I know about the need to be able to sell US debt abroad but let’s just say that the authorities do not want a Dollar collapse but they certainly do not want a soaring Dollar either. My guess is that they are happy to see it deflate in value and trade down towards the lower edge of its trading range. Certainly, someone does not see it as having any “value” up near the 87 level on the USDX.

 

Under normal circumstances we would have expected to see gold moving higher as the Dollar got trampled especially with crude oil showing such resiliency. Not so – today’s reason to explain the inexplicable says that gold is not needed during times when “risk” is in so let’s sell it. Wait another day because as soon as “risk is out”, gold will then be seen as too risky to buy and that will be the reason used to tell us why it is being sold off.  Actually I think the reason gold is lower today is because Jack Bauer hit the terrorists’ hideout last night in “24” and destroyed the CIP device in the process. Way to go Jack – maybe Jack can now save us from what the feds are doing to our monetary system.

 

The real reason is that a huge seller/sellers showed up today as gold rallied higher in New York, especially after the London PM Fix was done, and sat on the bids and that was that. No doubt they were some of the same crowd that did the selling yesterday as open interest indicates that plenty of fresh selling occurred yesterday.

 

Locals saw the stone wall in front of the market and ditched their positions and went short which also tripped the 3 minute bar charts bearish and the day trading crowd began to sell. That pushed out some weak or stale longs who decided to get out and wait for another entry point a bit lower. It looked as if $900 was going to hold on the downside test but sellers came in and gave it enough of an extra push to take out some stops near that level. Gold is attempting to recapture that level but so far has not been successful. Should the bulls not be able to hold it here, the next downside level will be good old $880 once again. That number has taken on an incredible significance from a technical level.”- Dan Norcini, More at JSMineset.com

 

“April Gold closed down 14.7 at 892.5. This was 1 up from the low and 20 off the high.

 

March Silver finished down 0.115 at 12.3, 0.145 off the high and 0.06 up from the low.

 

The April gold contract failed to hold above the $900 level and some traders saw that as a technical failure. Surprisingly the gold market fell in the wake of a quasi reversal in the Dollar but apparently seeing better than expected US Pending Home sales data deflated the flight to quality argument in gold and sparked an additional wave of long liquidation. In fact, it is somewhat surprising that the gold market wasn't able to rebound in the face of significantly weaker than expected monthly US auto sales readings and that suggests the market wasn't looking hard for flight to quality items. In the end, seeing the Dollar fall back and seeing very discouraging auto sales data would seem to ratchet up concern for the economy, but perhaps hopes for progress on the stimulus package served to keep the flight to quality crowd off balance.

 

The silver market also saw a lower low for the move on the charts, but the downside thrust in silver wasn't as significant as the downside pulse seen in the gold market. However, the silver market was probably indirectly pressured as a result of the better than expected US economic readings and directly undermined as a result of the weakness in the gold market. The silver bulls have to be somewhat disappointed that copper prices mounted a significant rally and yet that bullishness didn't seem to spillover into the silver action.”- The Hightower Report, Futures Analysis and Forecasting

 

GATA Posts:

 

 

Sprott says U.S. at start of depression that will boost gold

Will Obama give up secrets on PPT and gold?

 

The Statistics:

As of close of business: 2/03/2009

Gold Warehouse Stocks:

8,570,800

+14,107

Silver Warehouse Stocks:

122,308,768

+83,847

 

Global Gold ETF Holdings

[WGC Sponsored ETF’s]

 

-->

 

Product name

Total Tonnes

Total Ounces

Total Value

New York Stock Exchange Arca (NYSE Arca) AND Singapore Exchange (SGX) AND Tokyo Stock Exchage (TSE) AND Hong Kong Stock Exchange (HKEx)

SPDR® Gold Shares

853.37

27,436,852

US$ 25,186m

London Stock Exchange (LSE) AND Euronext Paris AND Borsa Italiana AND Frankfurter Wertpapierbörse (Deutsche Börse )

Gold Bullion Securities

127.53

4,100,181

US$ 3,685m

London Stock Exchange (LSE) AND Euronext Paris AND Borsa Italiana AND Deutsche Börse AND Euronext Amsterdam PHAU awaited awaited awaited

Australian Stock Exchange (ASX)

Gold Bullion Securities

12.49

400,581

US$ 361m

Johannesburg Securities Exchange (JSE)

New Gold Debentures

27.90

896,926

US$ 823m

Note: Change in Total Tonnes from yesterday’s data: SPDR added 9.78 tonnes to make for a new record high holding.

 

COMEX Gold Trust (IAU)

Profile as of 2/2/2009

 

Total Net Assets

$2,003,203,737

Ounces of Gold
in Trust

2,210,089.571

Shares Outstanding

22,450,000

Tonnes of Gold
in Trust

68.74

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

 

Silver Trust (SLV)

Profile as of 2/2/2009

 

Total Net Assets

$2,977,364,415

Ounces of Silver
in Trust

239,624,279.800

Shares Outstanding

242,850,000

Tonnes of Silver
in Trust

7,453.15

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

 

The Stocks:

 

B2Gold’s (BTO.TO) conference call with Central Sun (SMC), Newmont’s (NEM) public offerings, Minco’s (MGH) corporate update, Great Basin’s (GBG) test results, and Silver Standard’s (SSRI) updated resources were among the big stories in the gold and silver mining industry making headlines today.

 

WINNERS

1.  New Gold

NGD +9.41% $2.21

2.  DRDGOLD

DROOY+6.95% $7.54

3.  NovaGold

NG +6.69% $3.51

 

LOSERS

1.  Banro

BAA -9.09% $1.50

2.  Allied Nevada

ANV -4.04% $4.99

3.  US Energy

USEG -3.70% $1.82

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:

B2Gold to seek more takeovers after Central Sun - "Newmont Mining Corporation (NYSE: NEM - News; the "Company") today announced that it has realized aggregate net proceeds of approximately $1.7 billion on the closing its public offerings of 34,500,000 shares of common stock and $517.5 million principal amount of 3.00% convertible senior notes due 2012 (including common stock and convertible senior notes issued upon the exercise in full of over-allotment options to the underwriters). The Company intends to use the net proceeds from the offerings to fund the acquisition of the remaining 33.33% interest in the Boddington project in Western Australia that the Company does not already own and the additional capital expenditures that will result from its increased ownership in the Boddington project, as well as for general corporate purposes." More
- February 03, 2009 | Item | E-mail


Newmont Realizes $1.7 Billion on Completion of Common Stock and Convertible Debt Offerings - "Newmont Mining Corporation (NYSE: NEM - News; the "Company") today announced that it has realized aggregate net proceeds of approximately $1.7 billion on the closing its public offerings of 34,500,000 shares of common stock and $517.5 million principal amount of 3.00% convertible senior notes due 2012 (including common stock and convertible senior notes issued upon the exercise in full of over-allotment options to the underwriters). The Company intends to use the net proceeds from the offerings to fund the acquisition of the remaining 33.33% interest in the Boddington project in Western Australia that the Company does not already own and the additional capital expenditures that will result from its increased ownership in the Boddington project, as well as for general corporate purposes." More
- February 03, 2009 | Item | E-mail


Milner Announces Cancellation of Existing Stock Options and Grant of New Stock Options Under Existing Plan - More
- February 03, 2009 | Item | E-mail


Gold Reserve Issues Statement on Shareholder Rights Plan - "Gold Reserve Inc. (NYSE Alternext: GRZ) (TSX:GRZ - News) today issued the following statement in connection with Rusoro Mining Ltd.’s (TSX-V: RML - News) (“Rusoro”) announcement that it intends to seek a hearing before the Ontario Securities Commission (“OSC”) to cease trade the Gold Reserve Shareholder Rights Plan (the “Rights Plan”). Rusoro made an unsolicited offer on December 15, 2008 (the “Offer”) to acquire all of the outstanding shares and equity units of Gold Reserve in consideration for three shares of Rusoro for each Gold Reserve share tendered under the Offer:" More
- February 03, 2009 | Item | E-mail


Minera Andes Inc. announces director resignation - More
- February 03, 2009 | Item | E-mail


Baja Mining Provides Project Update - More
- February 03, 2009 | Item | E-mail


Avalon's New 43-101 Resource Estimate Confirms Increased Tonnage and Grade For Lake Zone REE Deposit, Thor Lake, NWT - More
- February 03, 2009 | Item | E-mail


Romarco Announces Corrected NPV Numbers - More
- February 03, 2009 | Item | E-mail


War Eagle Announces New Discovery Hole at Tres Marias; However, Exploration to Be Suspended During Economic Downturn While Company Increases Focus on Fly Ash - More
- February 03, 2009 | Item | E-mail


HuntMountain Announces High-Grade Results from Infill Drilling at La Josefina - More
- February 03, 2009 | Item | E-mail


East West Resource Corporation: Seagull PGE Exploration Program Advanced - More
- February 03, 2009 | Item | E-mail


Uranium Bay Resources Inc.: Assay Results from the 2008 Drilling Programme at the Uskawanis Uranium Project are Now Available - More
- February 03, 2009 | Item | E-mail


Flag Resources (1985) Limited Exploration Results West Sector Regional Wanapitei Anomaly Sudbury, Ontario - More
- February 03, 2009 | Item | E-mail


Golden Band Resources - RKN-Golden Heart area exploration update - More
- February 03, 2009 | Item | E-mail


Drilling Underway at Gossan-Marathon's Bird River Project - More
- February 03, 2009 | Item | E-mail


Marathon Files Technical Report on Feasibility Study and Resumes Drilling at Bird River - More
- February 03, 2009 | Item | E-mail


Treasury Metals Submits Proposal for the Acquisition of Sierra Minerals - More
- February 03, 2009 | Item | E-mail


Midlands Minerals Announces Granting of Options - More
- February 03, 2009 | Item | E-mail


Royal Roads regains 100% ownership of its Burtons Pond gold property, Newfoundland - More
- February 03, 2009 | Item | E-mail


Extract Resources Announces Board Changes - More
- February 03, 2009 | Item | E-mail


Red Metal Resources Ltd. Acquires Irene Property in Candelaria IOCG Belt - More
- February 03, 2009 | Item | E-mail


Golden Band Resources - Jolu-Decade exploration update - More
- February 03, 2009 | Item | E-mail


Nord Resources Commences Mining of New Copper Ore at Johnson Camp Copper Mine - More
- February 03, 2009 | Item | E-mail


Galahad Metals Appoints Malcolm, Meredith as Investor Relations Representatives - More
- February 03, 2009 | Item | E-mail


Strathmore Minerals Corp.: 2008 Year End Review of Operations at Wyoming & New Mexico Uranium Projects - More
- February 03, 2009 | Item | E-mail


Urex to Continue Uranium Exploration on the Carbon Project in Argentina - More
- February 03, 2009 | Item | E-mail


Colombia Goldfields Ltd. Announces Change in Board of Directors - More
- February 03, 2009 | Item | E-mail


Romarco Announces Bankable Feasibility at Haile - More
- February 03, 2009 | Item | E-mail


Verena Increases Resources at Volta Grande Gold Project, Brazil - More
- February 03, 2009 | Item | E-mail


Iberian Minerals Corp.-Issues Common Shares in Satisfaction of Interest Payment - More
- February 03, 2009 | Item | E-mail


Tombstone Exploration Corp. to Begin Phase 2 Drilling Program in Spring 2009 - More
- February 03, 2009 | Item | E-mail


Abacus Releases More Drill Results From Ajax Joint Venture Area - More
- February 03, 2009 | Item | E-mail


UC Hub Group, Inc. Closes Precious Mineral Claim Acquisitions - More
- February 03, 2009 | Item | E-mail


Wesdome 2008 production tops 90,000 ounces, sales exceed $80 million - More
- February 03, 2009 | Item | E-mail


Radisson Mining Adopts Shareholder Protection Rights Plan - More
- February 03, 2009 | Item | E-mail


Energy Fuels Adopts Shareholder Rights Plan - More
- February 03, 2009 | Item | E-mail


PC Gold Cuts Deep High-Grade Gold at Pickle Crow, Including 52.7 g/t (1.54 opt) Over 0.60 m (2.0 ft) and 31.90 g/t (0.93 opt) Over 0.5 m (1.6 ft) - More
- February 03, 2009 | Item | E-mail


Minco Gold: Progress in 2008 and Plan for 2009 - "Minco Gold Corporation (the "Company" or "Minco Gold") (Toronto:MMM.TO - News)(AMEX:MGH - News)(Frankfurt:MI5.F - News) provides a corporate update on progress made during 2008 and outlines the Company's plans for 2009. The Company made significant progress on the Changkeng Gold project and the Longnan Properties. Minco Gold also conducted a general review of its project portfolio to enable a more focused approach on its core assets." More
- February 03, 2009 | Item | E-mail


Great Basin Gold Ltd. - Results of Trial Mining and Ongoing Metallurgical Test Work at Hollister - "Great Basin Gold Ltd. ("Great Basin Gold" or the "Company") (TSX: GBG; NYSE Alternext: GBG; JSE: GBG) announces the results of its ongoing underground exploration and development (inclusive of trial mining and metallurgical test work) at Hollister for the year ended December 31, 2008." More
- February 03, 2009 | Item | E-mail


Silver Standard Resources Inc.: Snowfield Gold Resources Now 4.4 Million Ounces M&I and 14.3 Million Ounces Inferred - "Silver Standard Resources Inc. (Toronto:SSO.TO - News)(NasdaqGM:SSRI - News) is pleased to report a significant increase in gold resources at the Snowfield gold project in northern British Columbia. The increased resource is now comprised of measured and indicated gold resources totalling 4,362,000 ounces and inferred gold resources of 14,276,000 ounces using a cut-off grade of 0.5 grams of gold-equivalent per tonne. The property is located 65 kilometers north of the town of Stewart and 20 kilometers southeast of Barrick's high-grade gold-silver mine at Eskay Creek." More
- February 03, 2009 | Item | E-mail


 

- Chris Mullen, Gold Seeker Report

 

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© Gold Seeker 2008

Note: This article may be reproduced provided the article, in full, is used and mention to Gold-Seeker.com is given.

 

 

Disclosure: The owner, editor, writer and publisher and their associates are not responsible for errors or omissions.  The author of this report is not a registered financial advisor.  Readers should not view this material as offering investment related advice. Gold-Seeker.com has taken precautions to ensure accuracy of information provided. Information collected and presented are from what is perceived as reliable sources, but since the information source(s) are beyond Gold-Seeker.com’s control, no representation or guarantee is made that it is complete or accurate.  The reader accepts information on the condition that errors or omissions shall not be made the basis for any claim, demand or cause for action.  Past results are not necessarily indicative of future results.  Any statements non-factual in nature constitute only current opinions, which are subject to change.  Nothing contained herein constitutes a representation by the publisher, nor a solicitation for the purchase or sale of securities & therefore information, nor opinions expressed, shall be construed as a solicitation to buy or sell any stock, futures or options contract mentioned herein.  Investors are advised to obtain the advice of a qualified financial & investment advisor before entering any financial transaction.


-- Posted 3 February, 2009 | |


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