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Gold Seeker Closing Report: Gold and Silver Fall Over 2% and 3% While Stocks Gain Over 5%

By: Chris Mullen, Gold-Seeker.com


-- Posted 10 March, 2009 | | Source: SilverSeek.com

 

Close

Gain/Loss

Gold

$895.80

-$19.90

Silver

$12.51

-$0.40

XAU

109.97

-4.79%

HUI

259.51

-5.91%

GDM

819.77

-5.89%

JSE Gold

2716.66

-88.41

USD

88.77

-0.40

Euro

126.84

+0.72

Yen

101.39

+0.29

Oil

$45.71

-$1.36

10-Year

2.982%

+0.096

T-Bond

126.25

-1.25

Dow

6926.49

+5.80%

Nasdaq

1358.28

+7.07%

S&P

719.60

+6.37%

 
 

 

The Metals:

 

Gold and silver traded slightly higher in Asia and moderately lower in London before they plummeted in New York again and ended near their lows of $892.25 and $12.452 with losses of 2.2% and 3.1%.

 

Euro gold fell to about €704, platinum lost $25 to $1033, and copper gained over 4 cents to about $1.67.

 

Gold and silver equities fell over 6% by midday before they rebounded slightly in late trade, but they still ended with roughly 5% losses on the day.

 

The Economy:

 

Report

For

Reading

Expected

Previous

Wholesale Inventories

Jan

-0.7%

-1.0%

-1.5%

 

Bernanke had a speech this morning with the Council on Foreign Relations about the economy and the financial system and in the Q&A session he said that he did not support suspending mark to market rules.

 

FDIC's Bair: Bad assets plan can jump-start U.S. economy  Reuters
IMF warns of global "Great Recession"  Reuters
Bernanke Urges Rules Overhaul to Stem Risk Build-Ups  Bloomberg
U.S. Unemployment Rate to Reach 9.4% This Year, Survey Shows  Bloomberg

U.S. Second-Quarter Hiring Plans Hit Record Low, Manpower Says  Bloomberg

 

Tomorrow at 2PM brings February’s Treasury Budget expected at -$205,000,000,000.00.

 

The Markets:

 

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

 

Oil erased early gains and ended almost 3% lower “after the government again lowered its forecast for global energy demand and said average oil prices for this year will likely be below current levels.”

 

The U.S. dollar index and treasuries fell while the Dow, Nasdaq, and S&P rose over 5% on CEO Pandit’s claim that Citigroup is having its best quarter since 2007.  Word from Barney Frank that the uptick rule will also be restored within a month also raised spirits.

 

Among the big names making news in the market today were Citigroup, United Technologies, Merck, and Kroger.

 

The Commentary:

 

“Dear CIGAs,

 

News that CITI showed a profit (I say this with the utmost disdain) coupled with chatter that the SEC would reinstate the uptick rule next month, was enough to send equities sharply higher today. That of course did not help the gold stocks which were once again obliterated as gold was summarily dumped by investors since now that the worst of the crisis is behind us, it is no longer necessary to have a safe haven. It is safe to plunge headlong in the equity pool once more. After all, a stock that once traded at $50 and went down to $1.00 is a helluva deal especially seeing that it is such a profit-making machine.

 

Investors- have no fear – once you buy that stock and it doubles in price, you then get to contribute a nice chunk of your profits to the government seeing that the Obama administration plans on raising the capital gains tax. That way some more of your money can then be funneled right back into CITI which will then once more claim more “profits”, so you can then buy some more of it, so that you can then pay more capital gains taxes, so that more of your tax money can go back into CITI, and so on and so on and so on. Is it just me or is something fishy about the way this thing works? Either way, isn’t life grand when you are a well-connected banking insider?  A couple of hundred years ago and CITI would be hanging in effigy in the town squares of this nation. Now they are heralded… I was born in the wrong century! I would love to hold a bucket full of piping hot tar or at least a bag of feathers….

 

All of this commotion also means that that flight to the “safety” of the US Dollar is no longer necessary either, so down it went and up went everything else. For now gold is trading in lockstep with the Dollar meaning it is moving higher when it moves higher and lower when it moves lower. The effect is to take the gold price down sharply in terms of the other major currencies. I will be watching the price action in British Pound Gold and Euro gold to get a feel for when these retracement has run its course.

 

Today’s sharp drop in price brought gold within a whisker of critical support in the $890-$880 range. It needs to hold here or it has a very good chance of setting all the way back down to the 100day moving average near $840. We would then really get to see the gold bears whooping it up. Let me say here once again to all of you who take a perverse delight in filling my inbox with your rants every time gold experiences a correction in price, please buy all the Dollar backed paper assets you can possibly stuff into your portfolio and please sell every single bit of your gold, assuming you ever owned any, and have a happy life. I am sure your bonds, bills and notes will be of immense value next year. Those of us who actually are concerned about what we see coming to our nation and want to acquire the metal, will make certain that we come to you, bow down, kiss your feet and beg your for money so that we can survive, having ruined ourselves by our folly in buying real gold as a store of value. Repeat after me – PAPER – GOOD; GOLD- BAD.

 

Technically the price action in gold is bearish as it has fallen beneath the 50 day moving average, something which it had not done this year. That gives the bears the short-term edge and sets up a test of our old friend and Jim’s angel, $880, should it be unable to recapture the 50 day within the next two days or sooner. Bulls will need to hold their ground there or the retracement in gold will be deeper and longer in time.- Dan Norcini, More at JSMineset.com

 

“April Gold closed down 22.1 at 895.9. This was 2.4 up from the low and 16.1 off the high.

 

May Silver finished down 0.4 at 12.54, 0.275 off the high and 0.01 up from the low.

 

The April gold market forged a big range down extension on Tuesday and seemed to push the gold market through a series of potentially critical chart levels. Obviously the bears will tout the magnitude of the losses since the February highs, while the bull camp will suggest that the market at least initially rejected the early February consolidation low level of $893. The bull camp was probably disappointed in the failure to see much in the way of benefits from the weakness in the US Dollar. Apparently the rally in equities was at least partially inspired by news that a major and besieged US financial company was hinting at profits for the first two months of the year. In the end, seeing a tempering of financial sector flight to quality and seeing a strong rally in the equity market apparently prompted a number of gold bulls to scramble to the sidelines.

 

Silver also saw a moderate range down extension on Tuesday but the May silver contract initially managed to respect the early March low of $12.43. Clearly the silver market wasn't the least bit interested in the fact that a number of physical commodities like grains and copper were lifted by the sharp gains in the equity market and that suggests that the tempering of the flight to quality argument was serving to disappoint some traders. While we doubt that the silver market was paying that much attention to the physical supply side of the equation, it is possible that some of the selling was a reaction to news of a noted increase in 2009 silver output forecasts from a key silver producer.”- The Hightower Report, Futures Analysis and Forecasting

 

GATA Posts:

 

 

Ted Butler: Regulators who won't regulate

Patrick A. Heller: Number 1 reason to own gold

Five biggest U.S. banks are 'dead men walking'

Telegraph's Ambrose Evans-Pritchard interviewed on gold

 

The Statistics:

As of close of business: 3/10/2009

Gold Warehouse Stocks:

8,695,066

-

Silver Warehouse Stocks:

124,482,807

-

 

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

1,028.99

33,083,179

US$ 30,558m

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

Gold Bullion Securities

127.24

4,090,842

US$ 3,654m

Australian Stock Exchange (ASX)

Gold Bullion Securities

12.49

400,431

US$ 359m

Johannesburg Securities Exchange (JSE)

New Gold Debentures

28.62

920,166

US$ 850m

NASDAQ Dubai

Dubai Gold Securities

0.16

5,000

US$ 4m

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

 

COMEX Gold Trust (IAU)

Profile as of 3/9/2009

 

Total Net Assets

$1,999,639,797

Ounces of Gold
in Trust

2,179,187.377

Shares Outstanding

22,150,000

Tonnes of Gold
in Trust

67.78

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

 

Silver Trust (SLV)

Profile as of 3/9/2009

 

Total Net Assets

$3,392,201,627

Ounces of Silver
in Trust

253,938,438.700

Shares Outstanding

257,550,000

Tonnes of Silver
in Trust

7,898.37

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

 

The Miners:

 

Tanzanian Royalty’s (TRE) option agreement, ITH’s (THM) drill program, IAMGOLD’s (IAG) equity financing terms, Northern Dynasty’s (NAK) reporting standards, Endeavour’s (EXK) production review and outlook, Solitario’s (XPL) drilling plans and results, SNS Silver’s (SNS.V) interim lease, and Hochschild’s (HOCM.L) plans to buy Southwestern Resources (SWG.TO) were among the big stories in the gold and silver mining industry making headlines today.

 

WINNERS

1.  ITH

THM-12.28%$2.00

2.  IAMGOLD

IAG-11.60% $6.48

3.  Eldorado

EGO-10.11%$7.29

 

LOSERS

1.  Anglo American

AAUK +10.6% $7.41

2.  Freeport

FCX +5.72% $34.17

3.  Allied Nevada

ANV +3.96% $4.20

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:

Southern Energy Announces the Appointment of New Management - More
- March 10, 2009 | Item | E-mail


Tanzanian Royalty and Songshan Mining Co. Ltd. of Inner Mongolia, China Conclude 30-Year 3% Royalty Option Agreement on Kabanga Nickel Properties in Tanzania - "The company has entered into a royalty option agreement with Songshan Mining Co. Ltd. of Duolun, Inner Mongolia, China. Under the agreement, Songshan Mining is granted an option to acquire Tanzanian Royalty's interest in its Kabanga nickel licenses located in northwestern Tanzania, subject to a 30-year 3% net smelter royalty in favour of Tanzanian Royalty. Songshan Mining currently operates two iron mines in Inner Mongolia, China." More
- March 10, 2009 | Item | E-mail


International Tower Hill Mines Ltd. Doubles Planned 2009 Drill Program for Livengood Gold Project, Alaska - "International Tower Hill Mines Ltd. ("ITH" or the "Company") (CDNX:ITH.V - News)(AMEX:THM - News)(Frankfurt:IW9.F - News) is pleased to announce the results from two additional holes from the 2009 resource expansion drilling program on its Livengood Gold Project, Alaska. Holes MK-RC-0111 and MK-RC-0112 were drilled in the north-eastern portion of the higher grade Core Zone (Figure 1). Hole MK-RC-0112 intersected 100 metres of 1.11 g/t gold and 17 metres of 0.97 g/t gold. Hole MK-RC-0111 intersected 68 metres of 0.59 g/t gold." More
- March 10, 2009 | Item | E-mail


Benton Resources Corp (BTC) provides exploration update and evaluates advanced projects - More
- March 10, 2009 | Item | E-mail


Groundwater Testing Sets Stage for Missouri Uranium Project - More
- March 10, 2009 | Item | E-mail


Endeavour Silver 2008 Production Review and 2009 Production Outlook - "In 2008, Endeavour achieved two important milestones in its silver mining operations: the Company recorded its fourth consecutive year of growing silver production, up 9% from 2007 to 2.3 million ounces (oz) silver; and Endeavour posted its fourth consecutive quarter of falling cash costs of production, from US$11.09 per oz silver in the fourth quarter, 2007 to an estimated US$7.50 per oz silver in Q4, 2008." More
- March 10, 2009 | Item | E-mail


Augen Gold Special Committee says Augen Capital News Release is Not Accurate - More
- March 10, 2009 | Item | E-mail


Amex Exploration Closed First Tranche of $500,000 Financing - More
- March 10, 2009 | Item | E-mail


HudBay Minerals Announces Resignation of CEO and Appointment of Interim CEO - More
- March 10, 2009 | Item | E-mail


Castle Resources Provides Corporate Update - More
- March 10, 2009 | Item | E-mail


PDX Resources Advised of Appointment by Detour Gold of Derek Teevan as Vice President Aboriginal and Government Affairs - More
- March 10, 2009 | Item | E-mail


Waseco Updates Uranium Exploration Program - More
- March 10, 2009 | Item | E-mail


Pacific Gold Corp. - Oregon Gold Trading Symbol - More
- March 10, 2009 | Item | E-mail


Royal Mines Update - More
- March 10, 2009 | Item | E-mail


Detour Gold Appoints Derek Teevan as Vice President Aboriginal and Government Affairs - More
- March 10, 2009 | Item | E-mail


MAX recovers 4.9 grams/ton gold and 1.2 grams/ton silver from bulk sample at East Manhattan Wash in Nevada - More
- March 10, 2009 | Item | E-mail


Piedmont Mining Signs Letter of Intent on Argentite Gold Property, Nevada - More
- March 10, 2009 | Item | E-mail


General Metals Expands Operations in 2009 Ramp Up for Production - More
- March 10, 2009 | Item | E-mail


Drilling Continues to Expand Gold Mineralization at Houston Lake Mining's Dubenski Property - More
- March 10, 2009 | Item | E-mail


IAMGOLD Corporation Announces Terms of Cdn$300 Million Equity Financing - "The net proceeds from the Offering are expected to be used to fund the construction and development of the Essakane Project (replacing all or substantially all of the previously proposed Essakane project debt facility and related gold hedging requirements) and the balance to fund capital expenditures at IAMGOLD's other properties and for general corporate purposes including future acquisition opportunities." More
- March 10, 2009 | Item | E-mail


Solitario Exploration & Royalty Reports 2009 Drilling Plans and Final 2008 Bongara Drilling Results - "Solitario currently plans to drill three projects - the Pedra Branca PGM project in Brazil, and the Chonta and La Promesa silver-zinc-lead projects in central Peru. In addition, our joint venture partner Votorantim Metais, is planning another core drilling campaign on our high-grade Bongará zinc project in Peru." More
- March 10, 2009 | Item | E-mail


Northern Dynasty Early Adopts International Financial Reporting Standards - "Northern Dynasty Minerals Ltd. ("Northern Dynasty" or the "Company") (TSX: NDM; NYSE AMEX: NAK) announces that its application to early adopt International Financial Reporting Standards ("IFRS") under National Instrument 52-107 has been approved by the applicable Canadian Securities Administrators. The Company has chosen to early adopt IFRS and will commence reporting under these standards for the period beginning January 1, 2009. Comparative periods for fiscal 2008 will also be restated under IFRS." More
- March 10, 2009 | Item | E-mail


SNS Silver Completes Interim Lease - "This is a tremendous step for SNS Silver as the move allows the company to integrate its operations at the Crescent Silver Mine with the infrastructure already in place at the neighboring Sunshine property. This will be the first time these projects have operated under a single management team and will thus introduce enormous opportunity for exploration, mill feed and future expansion and development. It's especially good news for the region which came very close to losing one of its greatest silver properties due to Sterling Mining Co.'s termination of the mine lease and relinquishment of the mine to SPMI on the 19th of February," More
- March 10, 2009 | Item | E-mail


Southwestern Announces Letter Agreement With Hochschild Mining plc for Acquisition of All Outstanding Common Shares - "Southwestern Resources Corp. (Toronto:SWG.TO - News) ("Southwestern" or the "Company") is pleased to announce that it has entered into a Letter Agreement (the "Letter Agreement") with Hochschild Mining plc ("Hochschild") respecting the acquisition by Hochschild, directly or indirectly, of all of Southwestern's issued and outstanding common shares for cash consideration of $0.50 per share (the "Transaction")." More
- March 10, 2009 | Item | E-mail


Hochschild to buy Southwestern Resources - "Precious metals company Hochschild Mining PLC (HOCM.L) said on Tuesday it agreed to buy Southwestern Resources Corp (SWG.TO) for $17.5 million in cash.

Hochschild also said it has now sold forward a total of 10.7 million ounces of its 2009 silver equivalent production, comprised of 8.9 million ounces of silver at an average price of $12.09 and 30,000 ounces of gold at an average price of $972." More
- March 10, 2009 | Item | E-mail


 

- Chris Mullen, Gold Seeker Report

 

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© Gold Seeker 2009

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 10 March, 2009 | |


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