Gold Price Steady, Eyes Euro Meetings, U.S. Data

GOLD PRICE NEWS – The gold price oscillated between gains and losses near $1,750 per ounce on Monday following last week’s 2.2% advance.  On Friday the price of gold climbed to as high as $1,755, its best level since early October, amid a broad-based rally in precious metals and other commodities.  This morning’s stability in gold prices coincided with tepid movement in the currency markets, as the U.S. Dollar Index held near unchanged at 80.227.

Silver fared moderately worse than the price of gold, as it dipped by $0.18, or 0.5%, to $34.05 per ounce.  The weakness in silver followed a 6.1% surge higher last week, its best such stretch since mid-August.  Furthermore, silver advanced to as high as $34.22 in overnight trading, its best level in six weeks.

Gold stocks also lagged the gold price on Monday, as the sector succumbed to profit-taking and pressure from the broader equity markets.  Last week, the GDX jumped by 4.9%, its best period since mid-September.  This morning, however, the Market Vectors Gold Miners ETF (GDX) fell by $0.83, or 1.7%, to $47.91 per share while the S&P 500 Index slid by 6.13 points, or 0.4%, to 1,403.02.

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Within the gold sector, notable gold stocks moving lower included GDX components Barrick Gold (ABX), Newmont Mining (NEM), and Randgold Resources (GOLD).  Shares of ABX dropped by 1.7% to $34.94, NEM by 1.4% to $47.04, and GOLD by 2.9% to $104.28.

The broader financial markets headed south amid ongoing concerns over the fiscal cliff situation in the U.S. and the sovereign debt crisis in Europe.  Euro zone finance ministers and the International Monetary Fund are scheduled to meet again today in an effort to unfreeze the second bailout package for Greece.  However, policymakers will first need to determine if a portion of the Greek aid may eventually be restructured in order to reduce the nation’s crippling debt load.

Commenting on the latest Greek developments, analysts at Marex Spectron wrote in a note to clientst that “If they cannot resolve this, the euro may well be sold, which in turn will probably drag gold lower with it.”

Back in the U.S., in addition to the fiscal cliff, this week’s economic calendar contains several items likely to influence the price of gold and the markets as a whole.  Durable Goods for October will be announced on Tuesday morning, along with the Case-Shiller home price index for September and Consumer Confidence for November.  Wednesday’s schedule includes New Home Sales for October and the Federal Reserve’s latest Beige Book.

On Thursday, weekly Jobless Claims, third quarter GDP, and Pending Home Sales for October will be reported.   The week then will conclude on Friday with data on Personal Income, Personal Spending, Personal Consumption Expenditures (PCE, the Fed’s preferred measure of inflation), and the Chicago Purchasing Managers’ Index.

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