Gold & Silver Jump Over 3%, US Stimulus Agreed at $789Bn

From Chris Mullen at GoldSeek.com...

The Gold Price held near Tuesday's close of $911.60 in Asia on Wednesday, rose over 1% to the $920s in London, and then surged to $946.50 by 11:00 in New York.

Spot Gold then held near $940 by noon, but rose again to a new session high of $947.42 in the last few minutes of trade and ended with a gain of 3.4% for the session.

The Dow Jones index on Wall Street meantime recovered 0.6% after Tuesday's shock 5% loss. Treasury bonds also rose, pushing yields lower on worries over whether or not the government's rescue plans will be able to stimulate (save) the economy (financial) system, but reports after the close said the US Senate and House of Representatives had bridged their differences over the latest injection plans, agreeing to a $789bn package.

Crude oil fell as the International Energy Agency (IEA) reported continually falling demand and the US oil agency reported a greater than expected 4.7 million barrel increase in crude stockpile inventories.

Gasoline futures rose as gas inventories surprisingly fell 2.6 million barrels. 

The US Dollar index was little changed against the Euro despite a volatile session on Wednesday.

Silver traded mostly slightly higher from yesterday's close of $13.11 in Asia and climbed to over $13.40 in London before it dipped back under $13.30 in early New York trade, but it also exploded back higher in midmorning trade and ended near its session high of $13.68 with a gain of 3.1%.

The Gold Price in Euros rose to €733, touching new all-time highs, while platinum gained $40 to $1068, and copper fell a few cents to about $1.53.

Gold Mining and silver equities rose over 8% by early afternoon in New York before they pared their gains a bit as the major indices briefly turned gains into losses.

The miners then turned back higher in the last couple of hours of trade and ended with gains of over 7%.

The US Trade Deficit for Dec. showed a six-year low, but was greater than expected at $39.9 billion.

The US Treasury Dept. budget deficit for last month showed a leap to $83.8bn, ahead of forecasts at $78.0bn.

Thursday at 08:30 EST brings Initial US Jobless Claims for last week, expected at 610,000, plus Retail Sales for January (expected down 0.3%) and Retail Sales excluding auto sales (expected at -0.4%).

At 10:00 comes the Business Inventories report for December expected at -0.6%.