Gold & Stocks End Oct. 14% Lower as Dollar Rally Continues, Japan Cuts Interest Rates

From Chris Mullen at GoldSeek.com...

Gold Prices fell $16.60 to $721.05 by late trade in Asia on Friday, before rallying to see a slight gain at $740.83 in New York.

Spot Gold then fell back off into the close and ended near its new session low of $716.55 with a loss of 2.51% for the day.

For the week, Gold Bullion was 1.4% lower vs. an 11% jump in the US stock-market. Gold closed the month of October down 14%, the same proportion lost by Wall Street.

Crude oil prices spent most of Friday slightly lower on continued demand worries, but WTI then spiked higher in the last minutes of US trade and ended with a decent gain as traders positioned themselves for the end of the week and month.

The US Dollar index rose as the Euro fell on the continued view that Europe is worse off than the US going forward. The Bank of Japan gave mixed indications with its rate cut. Their policy board was split 4-4 on the decision and the central bank governor’s vote in favor carried the motion to cut its base lending rate 0.20% to 0.30%.

Three of the four dissenting BoJ votes came from board members who had sought a larger cut of 0.25%, but it leaves the door open for another cut of 0.20% to 0.10% to avoid going all the way to 0% if (or when) another cut is deemed to be necessary.

US Treasury bonds fell as the Dow, Nasdaq, and S&P followed European shares higher despite disappointing economic data.

US Personal Spending fell the most in four years and Michigan Sentiment reported the largest monthly drop since the survey began in 1978.

Silver dropped 5.6% on Friday by late trade, and then rallied to end at $9.73 an ounce, down 0.21% for the session, up 4.9% for the week, and almost one-fifth lower from the end of September.

The Gold Price in Euros fell Friday to €564, platinum lost $12 to $810.50, and copper fell over 4 cents to about $1.84.

Gold and silver equities fell over 4% at the open before they rebounded back to unchanged by mid-afternoon, but they then fell back off into the close and ended with over 4% losses. The XAU was 15% higher for the week.

Next week’s economic highlights include US Construction Spending and the ISM Index on Monday, Factory Orders on Tuesday, ADP Employment and ISM Services on Wednesday, Initial Jobless Claims and Productivity on Thursday, and October’s jobs data, Pending Home Sales, Wholesale Inventories, and Consumer Credit on Friday.