| Close | Gain/Loss | On Week |
Gold | $1208.95 | +$11.65 | +2.47% |
Silver | $18.35 | +$0.88 | -1.34% |
XAU | 171.89 | -1.55% | -3.98% |
HUI | 451.62 | -1.37% | -2.59% |
GDM | 1358.07 | -1.38% | -2.70% |
JSE Gold | 2440.63 | +17.09 | +1.28% |
USD | 84.42 | -0.46 | +3.17% |
Euro | 127.45 | +0.92 | -4.28% |
Yen | 109.40 | -1.02 | +2.81% |
Oil | $75.11 | -$2.00 | -12.81% |
10-Year | 3.429% | +0.031 | -6.39% |
Bond | 122.1875 | -1.15625 | +2.65% |
Dow | 10379.60 | -1.34% | -5.71% |
Nasdaq | 2265.64 | -2.33% | -7.95% |
S&P | 1110.86 | -1.53% | -6.39% |
The Metals:
Gold fell to as low as $1192.52 in late morning New York trade before it jumped to as high as $1212.93 by early afternoon and ended with a gain of 0.97%. Silver fell to as low as $17.445 in late morning New York trade before it jumped to as high as $18.647 by early afternoon and ended with a gain of 5.04%.
Euro gold rose to a new all-time high at about €953, platinum lost $2 to $1655, and copper rose a couple of cents to about $3.13.
Gold and silver equities fell roughly 1.5% by midmorning and remained at about that level for the rest of the day.
The Economy:
Report | For | Reading | Expected | Previous |
Nonfarm Payrolls | Apr | 290K | 187K | 230K |
Unemployment Rate | Apr | 9.9% | 9.7% | 9.7% |
Average Workweek | Apr | 34. | 34.0 | 34.0 |
Hourly Earnings | Apr | 0.0% | 0.1% | -0.1% |
Consumer Credit | Mar | $2.0B | -$3.9B | -$6.2B |
The BLS net birth/death adjustment added 188,000 payrolls to April’s data.
All of this week’s other economic reports:
Next week’s economic highlights include Wholesale Inventories on Tuesday, the Trade Balance and Treasury Budget on Wednesday, Initial Jobless Claims and Export and Import Prices on Thursday, and Retail Sales, Capacity Utilization, Industrial Production, Michigan Sentiment, and Business Inventories on Friday.
The Markets:
Charts Courtesy of http://finance.yahoo.com/
The U.S. dollar index and treasuries fell on profit taking after pretty remarkable gains earlier in the week.
Oil fell to almost $75 a barrel on continued worries over Europe that sent the Dow, Nasdaq, and S&P at least 1% lower on the day.
Among the big names making news in the market Friday were Washington Post, Goldman Sachs, AIG, and Honeywell.
The Commentary:
“One of the greatest gentlemen I ever met was market forecaster Kennedy Gammage. He was known for his many sayings, one of which is most appropriate for the start of my update:
“Those of us who make a living looking into a crystal ball will end up learning how to eat lots of broken glass.”
Days like today do a lot more than cause great volatility. They also bring a reality to some but often end up overlooked or purposely ignored by many. Its days like today when investors/speculators/gamblers get to see what they really are made of (or the lack thereof). What they “thought” their financial and mental anguish tolerance levels were and what they suddenly realize they really are, end up two very different things.
For years I’ve spoken about how we’re all really gambling but Wall Street purposely avoids implying that with words like “speculating” and such. Gamblers must be prepared to lose part or all their capital but investors/speculators end up on days like today realizing they’re truly not prepared for the downside of investing/speculating/gambling. For a small minority, today and days like today end up being a watershed event, and they finally shed themselves from the myths and mistruths Wall Street has embedded in their heads and ultimately approach their finances in a proper manner. For these fortunate souls, today’s action makes it all worthwhile.
U.S. Stock Market – Erroneous trades, Greece, the U.S. Dollar, LT arrested, Jupiter crossed Saturn, Mr. T. lost his gold… whatever the number of reasons end up being “assumed” as the reason or reasons for the sell-off, the only thing soothsayers like me are suppose to do is predict what’s going to happen next. Some may not like my answer but it’s 100% factual – I’ve nothing close to certainty or even a very reasonable guess. Hmmm…. How can that be you say? Given the numerous fundamental and technical factors and the fact the daily playing field is very tilted against little players like me and most who are reading this, it would be more of an act for me to state with any real degree of certainty and/or expectation what may or may not happen.
Now, if you’re willing to except a total “guess,” please read on.
After months of straight up with little or no real corrections, one could argue at the very least a 10% or so correction from the recent highs is healthy. Knowing Wall Street thrives on the “Don’t Worry, Be Happy” approach, I fully expect the many spokespeople of financial institutions to take their usual stance of “it’s a buying opportunity.” Let’s not forget that you could toss these folks off the top of the Empire State Building and all the way down they all would say the same thing – “So far so good!”
The bearish argument, one that has drawn many lines in the sand from the bottom in March 2009, only to see the bulls run rampart over them, will certainly be jumping up and down saying this one is the real McCoy and to run, not walk (if you still have any legs following them the last year or so) to the nearest exit.
Given what took place today and tomorrow’s monthly employment exercise, I think any hard decisions should wait until at least this weekend. There’s no position one could possibly be in that can’t endure one more day, if not several days as big swings should be the rule until further notice.
I don’t think much has changed in the scenario I’ve painted for over a year as I still am looking for the ultimate market peak not before June/July at the earliest.
Gold – I guess my $1,200 before $1,000 bet can now be officially considered passed on-lol. Like the stock market, gold is going to be very volatile for at least tomorrow. A stock market rally could bring on a $20-$40 decline. Further equity market weakness and we can make a new nominal high. Either way, my long term target of $1,300 – $1,500 has never looked better.
U.S. Dollar – If there’s one market that could see severe profit-taking tomorrow, especially if it opens up nicely higher, it is the U.S. Dollar. The bear market rally should continue after any profit-taking.
Oil – For traders/gamblers only (that leaves 95% of you out whether you like it or not), going long oil around $75 if it sells off to that level is interesting.
Bonds – If anything good came out of this it’s the opportunity to sell bonds –again.”- Peter Grandich, Grandich Letter
“Dear CIGAs,
There was a great deal of volatility in gold today although you could not tell it by just looking at the daily chart. The five minute chart shows a market bouncing back and forth between $1194 on the downside and $1206 on the upside. Volume picked up every time the market dipped down towards $1194 with buyers coming in and taking it back above $1200. When it got back above that level, it seemed as if they lacked the conviction to take it up through $1206. Finally, about 45 minutes before the close of the pit session trading, the longs were able to take it up through the barrier erected at $1206 and off she went carrying the shorts out with it. Once the pit session closed, the sellers came back in and tried pushing it back below $1206. The battle rages on.
Technically the gold bulls have cleared a significant hurtle and coming on a Friday in front of a weekend in which anything is possible, that was no mean feat. There looks to be a bit of light resistance just above $1220 which if cleared should give the market the necessary momentum to take on the old lifetime high. Depending on what transpires over the weekend, it could do that in Monday’s session.
Open interest increases reveal that managed money is pouring steadily into gold which is healthy. We will get a glimpse into the composition of the market internals this afternoon when the COT numbers are released. Sadly they will tell us NOTHING about what occurred internally the last three days of this week which is exactly what we really would like to see. Still, it is a given that managed money, the public and the CTA’s were on the long side with the commercials and swap dealers (banks) on the short side. What else is new…
There was some chatter that perhaps over the weekend the G7 comic book characters would come up with some sort of plan to stabilize the situation in Europe that is rapidly spiraling out of control although what that might be remains unclear. They of course could purchase Greek bonds as well as those of Portugal and/or Spain but the ECB still seems reluctant to do that. Any such plan would have a temporary effect but would not deal with the root of the problem at hand, to wit – too many countries that make up the Euro Zone have a dynamic that is going to require a great deal of pain and seemingly few of the political leaders have the intestinal fortitude to do what is required.
Several of these countries have established a Nanny State with cradle to grave benefits which are increasingly being funded by a smaller and smaller group of producers and being milked by an ever increasing group of recipients. The problem is that which Margaret Thatcher summed up so succinctly many years ago: “The problem with socialism is that eventually you run out of other’s people money”.
On top of that there is the sacred cow which it seems very few are willing to address and that is the declining birth rate in many of these countries. You end up with a growing group of retirees and other wards of the state being funded by a declining group of producers. That is simply not sustainable in the long run. The smart aleck Keynes quipped “that in the long run we are all dead”, but the truth is policies have consequences and the long term effects of the nanny state are now reaching a critical level. Until government spending is sharply reduced, and major policy changes are effected, any bailout or fix is only going to put a Band-Aid on a festering problem which will again return to haunt the Eurozone. With the citizens of Greece intent on burning down their own country as they take to the streets to riot and protest any cuts whatsoever in the lavish benefits which they are grown addicted to, one wonders how many politician are going to be statesmen with long term views or poll readers with short-term priorities. If you want to get a taste of where the US is eventually headed, barring an abrupt about-face on current policies, take a good long look at Greece.
A brief comment on yesterday’s severe meltdown in the US equity markets – I found it rather amusing listening to the financial TV folks yesterday attempting to come up with reasons to explain the 1000 point plunge in the DOW in minutes only to see it recapture more than half of its losses coming into the closing bell within minutes as well.
One guy noted that the sun came up in the West this morning and that startled investors who feared that the universe was being turned inside out by the “waves” coming from high frequency traders. That is obviously my poor attempt at some humor but the real problem is that which we have been talking about for at least 4 years here at the site now, namely, the computer algorithms that have all but taken over the US financial markets. I have quipped that SkyNet is now in control of our markets and if there is any doubt of that after yesterday’s debacle, that should be settled by now. These damn machines and their cursed algorithms front run every single order coming into the pits as fast as they hit the screen (faster actually). They are all doing the same thing at the same millisecond in time meaning that there is literally no one to take the other side of the trade, either going down or, as what happened when the market reversed, going back up. The end result – huge air pockets devoid of bids when the market is selling off or huge vacuums devoid of offers on the way up – just look at silver today and try explaining a market that dropped over 1000 points on Tuesday of this week followed by another drop of 800 or more points on Wednesday and then goes back up over 1000 points during the session today. That is an example of what is wrong with our markets.
These damn funds have got to be throttled in, exchanges bitching, kicking and screaming notwithstanding, or else the general public is going to walk away completely from them as will the commercial interests in the commodity markets. When that occurs, all that will be left is hedge funds trading against themselves which each of them trying to spend millions to see whose algorithm will rule them all (with apologies to Sauron). That will not be price discovery but rather an extremely expensive version of the World of Warcraft. Many of the battered hedge funds will end up needing more than “a Healer” to then fix what ails them.
Euro gold set a brand new all time high at the PM fix today at €949.045 as did British Pound priced gold which cleared Ł800 coming in at Ł818.581.
There is an element of the election returns in the British Pound priced gold fix. There was no clear winner even though Cameron’s conservatives won the majority of seats they did not win enough to have clear control of the government. Investors wasted little time in punishing Sterling as a result since it will be extremely difficult for the government to come to a consensus and tackle the many problems that now threaten its fiscal house. This, in conjunction with continued concerns with the stability of currencies related to Europe, allowed gold to push past the Ł800 level in British Pounds.
Bonds went on one huge, wild ride today after their wild ride of yesterday. I am not even going to attempt to give an analysis on that market other than to say those who think US Treasuries are any sort of safe haven for “wealth preservation” when they can purchase gold instead are sorely deluded. Technically, bonds have not been able to manage a weekly close much above 123 since April 2009 and that was on the way down. It would appear that sellers are more than obliging to unload them above 123. We will see what they do next week because for all the violent motion of the past two weeks, they have done nothing more but reach the top side of a trading range that has been in effect for the 7 months or so. An upside breakout would have significant meaning.
Crude oil is getting hammered again and threatening to sink all the way back down towards $70 if it cannot soon manage a weekly close above $78.
I am not going to comment further on the equity markets because at the rate they are going and the wild swings that they are making, any commentary would be obsolete 15 minutes after I write it. See the chart I sent up yesterday for a bigger picture view.
Same comment on the HUI as yesterday– until the hedge fund ratio trades get lifted, the miners are still more heavily influenced by the broader equity markets than the bullion price. That strategy is going to blow up in their faces eventually but for now it is a function of their infernal algorithms. Far too much money has been siphoned out of the mining shares by that Trojan Horse called a gold ETF. Keep in mind that what drives stock prices are profits and well managed gold miners with good properties and low debt levels are going to see those profits increase as gold powers higher. That is the Achilles heel of the hedge fund ratio trades.”- Dan Norcini, More at JSMineset.com
GATA Posts:
Former comptroller general speaks at CMRE on May 20
In Treasury report, shocking evidence of silver price suppression
James Turk looks at housing prices through a golden lens
Manipulation of precious-metals market under fire
Physical market has smashed gold paper, Sinclair tells King World News
The Statistics:
Activity from: 5/06/2010
Gold Warehouse Stocks: | 10,239,714 | +50,670 |
Silver Warehouse Stocks: | 116,744,317 | +97,007 |
Global Gold ETF Holdings
[WGC Sponsored ETF’s]
New York Stock Exchange Arca (NYSE Arca) AND Singapore Exchange (SGX) AND Tokyo Stock Exchange (TSE) AND Hong Kong Stock Exchange (HKEx) | SPDR® Gold Shares | 1185.787 | 38,124,248 | US$45,815m |
London Stock Exchange (LSE) AND Euronext Paris AND Borsa Italiana AND Frankfurter Wertpapierbörse (Deutsche Börse ) | Gold Bullion Securities | 115.15 | 3,702,150 | US$4,438m |
Australian Stock Exchange (ASX) | Gold Bullion Securities | 14.21 | 476,195 | US$553m |
Johannesburg Securities Exchange (JSE) | New Gold Debentures | 48.93 | 1,573,218 | US$1,865m |
NASDAQ Dubai | Dubai Gold Securities | 0.155 | 4,976 | US$6m |
Note: Change in Total Tonnes from yesterday’s data: SPDR added 19.785 tonnes to a new record high holding and the LSE added 0.11 tonnes.
COMEX Gold Trust (IAU) Total Tonnes in Trust: 78.59 - No change from yesterday’s data.
Silver Trust (SLV) Total Tonnes in Trust: 9011.50: +68.6 change from yesterday’s data.
The Miners:
Ivanhoe’s (IVN) approved resolutions, Richmont’s (RIC) first quarter results, IAMGOLD’s (IAG) first quarter results, Allied Nevada’s (ANV) drill results, Gold Fields (GFI) quarterly results, AngloGold’s (AU) first quarter results, Metalline’s (MMG) planned activities, and Silver Quest’s (SQI.V) drill results were among the big stories in the gold and silver mining industry making headlines Friday.
WINNERS
1. Allied Nevada | ANV+2.38% $18.08 |
2. Buenaventura | BVN+1.25% $33.23 |
3. Eldorado | EGO+0.94%$16.03 |
LOSERS
1. Vista Gold | VGZ-8.20% $2.24 |
2. Golden Star | GSS-8.05% $4.00 |
3. Paramount | PZG -6.86% $1.63 |
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:
Gabriel Resources Ltd. to Release First Quarter 2010 Results - More
- May 07, 2010 | Item | ShareThis
TNR Provides Update on Los Azules Copper Project - More
- May 07, 2010 | Item | ShareThis
NWT Uranium Corp.: Results of Niger Uranium Ltd Annual General Meeting-Special Dividend Approved - More
- May 07, 2010 | Item | ShareThis
Tribute Minerals Closes a Flow-Through Financing and Initiates Airborne Geophysical Survey in the 'Ring of Fire' - More
- May 07, 2010 | Item | ShareThis
Duncan Park Completes Private Placement - More
- May 07, 2010 | Item | ShareThis
Ivanhoe Mines' Shareholders' Rights Plan Approved at Annual General and Special Meeting - "Ivanhoe Mines Ltd. (TSX:IVN - News)(NYSE:IVN - News)(NASDAQ:IVN - News) announced that shareholders overwhelmingly approved all resolutions brought before them at the company's Annual General and Special Meeting held in Vancouver today, including approving the company's previously announced shareholders' rights plan. The plan was supported by 95.7% of the votes cast by Ivanhoe Mines' minority shareholders." More
- May 07, 2010 | Item | ShareThis
Great Western Minerals Group Ltd. Appoints Dwight Percy as Manager, Investor Relations - More
- May 07, 2010 | Item | ShareThis
GoldSpring, Inc. Announces Shareholder Approval of 1:200 Reverse Stock Split - More
- May 07, 2010 | Item | ShareThis
NV Gold Leases New Mexico Copper Project - More
- May 07, 2010 | Item | ShareThis
Coro Provides Update on San Jorge Project and Announces Acquisition of Celeste Project - More
- May 07, 2010 | Item | ShareThis
Colossus Minerals Inc. Announces the Granting of a Mining License for Serra Pelada - More
- May 07, 2010 | Item | ShareThis
Ignacio Rosado Elected to Zincore Board of Directors Along With All Incumbent Directors - More
- May 07, 2010 | Item | ShareThis
Ventana Announces Settlement of La Bodega Arbitration and Acquisition of La Baja Property - More
- May 07, 2010 | Item | ShareThis
Royal Roads adds to board of directors - More
- May 07, 2010 | Item | ShareThis
Ranger Gold Corp. Announces Completion of Financing - More
- May 07, 2010 | Item | ShareThis
Queenston Continues to Report Deep High-Grade Results at Upper Beaver - More
- May 07, 2010 | Item | ShareThis
Guinness Exploration Successfully Raises U.S. $500,000 Additional Funding for Nantawa Project - More
- May 07, 2010 | Item | ShareThis
Opawica Explorations Inc. announces further assay results from its 100% owned Atikwa Lake gold and copper property located near Kenora, Ontario - More
- May 07, 2010 | Item | ShareThis
Western Copper Accelerates Expiry of Warrants - More
- May 07, 2010 | Item | ShareThis
Novus Gold Corp.: Drilling Starts on REN Gold Property - More
- May 07, 2010 | Item | ShareThis
Anglo Swiss Resources' Litigation Dismissed - More
- May 07, 2010 | Item | ShareThis
Forsys Announces Signing of a Letter of Intent With Angus Mining (Namibia) Ltd and Golconda Capital Corp - More
- May 07, 2010 | Item | ShareThis
Tiger Resources Announces Receipt of Final Approvals for Trafigura Financing Package - More
- May 07, 2010 | Item | ShareThis
Skyline Announces Closing of Private Placement - More
- May 07, 2010 | Item | ShareThis
Explorator Resources Restates Third Quarter 2009 Financial Results to Reflect Change in Accounting Policy - More
- May 07, 2010 | Item | ShareThis
Louvem Mines Reports 2010 First Quarter Results - More
- May 07, 2010 | Item | ShareThis
Foundation Resources Announces Equity Financings for Proceeds of Up to $3,516,300 - More
- May 07, 2010 | Item | ShareThis
Medusa Mining Limited: Copper Portfolio-Lingig Update - More
- May 07, 2010 | Item | ShareThis
First Uranium names new Chairman, Lead Independent Director and the composition of the Committees of the Board - More
- May 07, 2010 | Item | ShareThis
Metalline Provides Detail on Planned Activities - "Metalline Mining Company (NYSE Amex: MMG) announces recent progress and planned expenditures following the successful closing of the transaction with Dome Ventures Corporation on April 16, 2010. In connection with the closing, Metalline moved forward with its 2010 budget plan for the Sierra Mojada project, which calls for an aggressive exploration drilling program on the silver mineralization located north of the Sierra Mojada fault. Approximately 44,000m of drilling are planned for calendar 2010, of which over 3400m have been drilled as of the end of April. The pace of drilling is accelerating through double shifting of Company diamond drills and the use of drilling contractors. A total of at least six drills will be turning on the project at the peak of activities. Initially this work will be focused in the west end of Metalline's concessions." More
- May 07, 2010 | Item | ShareThis
Richmont Mines Reports Improved Revenue and Net Income in the First Quarter of 2010 - "Net earnings for the first quarter of 2010 increased 23% to $1.8 million, or $0.07 per share, compared with net earnings of $1.4 million, or $0.05 per share, in the first quarter of 2009." More
- May 07, 2010 | Item | ShareThis
Silver Quest Resources Ltd.: Davidson Property Drill Results - "Silver Quest Resources (TSX VENTURE:SQI - News; "Silver Quest" or "the Company") wishes to report that Richfield Ventures Corp. ("Richfield") has announced drill results from the extension of drill hole BW 59 on the Company's Davidson Property, located approximately 110 kilometres southwest of Vanderhoof, British Columbia. The Davidson Property is under option to Richfield and forms part of Richfield's "Blackwater Project"." More
- May 07, 2010 | Item | ShareThis
IAMGOLD Reports First Quarter 2010 Results; Continued Strong Performance as Essakane Poised for Early Start-Up - "In the first quarter of 2010, net earnings were $58.8 million ($0.16 per share) as compared to $52.5 million ($0.17 per share) in the first quarter of 2009. Adjusted net earnings(1) rose 63% to $51.3 million ($0.14 per share(1)) compared to 2009 adjusted net earnings of $31.5 million ($0.10 per share). The increase in adjusted net earnings is mainly due to higher revenues partially offset by higher mining costs." More
- May 07, 2010 | Item | ShareThis
Allied Nevada Drills 172 Meters Grading 3.4 g/t Gold Equivalent (1.1 g/t Au and 125 g/t Ag) in the Vortex Zone at Its Hycroft Mine - "Allied Nevada Gold Corp. ("Allied Nevada" or the "Company") (TSX:ANV - News)(AMEX:ANV - News) is pleased to announce highlights from two additional holes drilled in the Vortex Zone at its wholly owned Hycroft mine located near Winnemucca, Nevada. These two holes were part of a program designed to test the mineralization identified by previously announced drilling (see press release dated January 11, 2010). Hole 10-3659, drilled approximately 50 meters west of the Albert Fault in the northwest region of the Vortex Zone, intersected 172 meters of mineralization grading 1.1 g/t Au(1) and 125 g/t Ag(1) (3.4 g/t AuEq(1)(2)). Hole 10-3848, collared approximately 300 meters northeast of hole 10-3659, returned 41 meters grading 0.67 g/t Au and 95 g/t Ag (2.43 g/t AuEq)." More
- May 07, 2010 | Item | ShareThis
Production and Earnings Decline Due to Seasonal Christmas Break in South Africa - "Gold Fields Limited (Gold Fields) (JSE, NYSE, NASDAQ Dubai: GFI) today announced net earnings for the March 2010 quarter of R316 million compared with earnings of R1,409 million and R1,307 million in the December 2009 and the March 2009 quarters respectively. In US dollar terms net earnings for the March 2010 quarter were US$44 million, compared with US$187 million and US$140 million for the December 2009 and March 2009 quarters respectively." More
- May 07, 2010 | Item | ShareThis
AngloGold Ashanti Profit Buoyed by Strong Tanzania, Brazil Performances - "AngloGold Ashanti (NYSE:AU - News) posted first-quarter adjusted headline earnings of $61 million after a strong performance from its mines in Tanzania and the Americas helped offset seasonally lower production from South Africa." More
- May 07, 2010 | Item | ShareThis
- Chris Mullen, Gold Seeker Report
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-- Posted 7 May, 2010 | |
