Gold News

Gold Ends Tues 1.1% Lower as Oil Slips, Stocks Bounce; US Home Sales Pick Up

From Chris Mullen at GoldSeek.com...

Gold Prices continued Monday's fall early Tuesday, dropping as low as $790.10 by the start of Asian trade before rallying back to $808.70 by the start of London dealing.

The Gold Market then flipped either side of unchanged in London and early morning New York trade ahead of a late morning drop to $793.75, but it then came off that low in afternoon trade and ended with a loss of 1.10% for the session.

Silver futures dropped to $14.31 in afterhours access trade before it rallied to as high as $14.90 by midmorning in New York, but it then fell back off in the last few hours of trade and ended with a loss of 1.22%.

Gold Priced in Euros fell to a low of €546 per ounce, platinum gained $29 to $1415, palladium gained $5 to $369, and copper remained at about $3.15.

Gold and silver equities rose over 2.5% at the open before they fell back near unchanged by late morning, but they then rallied back higher in afternoon trade and ended with over 2% gains.

On the economic front, the US Treasury Budget deficit for Oct. came in at -$55.6bn, larger than Sept.'s deficit but smaller than Wall Street forecasts. Pending Home Sales actually rose, increasing 0.2% in Sept. from August's record 6.5% drop.

The US Dollar index still fell back off after Monday’s rebound, but it did end short of making a new all-time low.

Wednesday at 12:30 GMT will bring the US Producer Price Index for last month, expected to show 0.3% growth, plus Retail Sales expected at 0.2% with sales excluding autos expected at 0.3%.

At 14:00 is the Business Inventories report for Sept., expected at 0.4%.

In the broader markets, crude oil fell prices markedly as the International Energy Agency lowered its world demand forecast and provided a catalyst for speculative positions to bail out after the recent record run. Inventory reports, normally due out Wednesday, are delayed until Thursday due to the Veteran’s Day Holiday.

Treasuries fell while the Dow, Nasdaq, and S&P rallied over 2% from oversold conditions. Wal-Mart, the giant US retailer, did not lower its guidance as many had feared. Financial stocks also rebounded, and traders seemed especially encouraged by Goldman Sachs, which again reiterated that it would not have to suffer a big writedown from subprime losses.

Among the big names making news in the market today were Bank of America, Home Depot, Countrywide, Wal-Mart, and Citigroup.

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Adrian Ash is director of research at BullionVault, the world-leading physical gold, silver and platinum market for private investors online. Formerly head of editorial at London's top publisher of private-investment advice, he was City correspondent for The Daily Reckoning from 2003 to 2008, and he has now been researching and writing daily analysis of precious metals and the wider financial markets for over 20 years. A frequent guest on BBC radio and television, Adrian is regularly quoted by the Financial Times, MarketWatch and many other respected news outlets, and his views from inside the bullion market have been sought by the Economist magazine, CNBC, Bloomberg, Germany's Handelsblatt and FAZ, plus Italy's Il Sole 24 Ore.

See the full archive of Adrian Ash articles on GoldNews.

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