Statistics: London Gold Fix $1,748.00 +$.25 LME Copper Stocks 225,150 tons +700 tons

GOLD MARKET FUNDAMENTALS: (6:00 AM CST) While gold seemed to shift back into a classic physical commodity market that could be cheered by a return to growth in the economy, the market overnight hasn't been able to fully embrace that line of thinking. In fact, there would appear to be a bit of divergence in place overnight, with gold and silver prices tracking lower, while platinum and copper tracked higher. Perhaps gold was knocked off balance by reports that all strikers workers at "one" Gold Field mine in South Africa had returned to work before the company imposed deadline. On the other hand, gold could draft some residual support off positive long term Asian gold demand forecasts, especially after the Chinese numbers overnight, highlight a stark contrast between the rate of growth in China and other developed countries. Gold might also begin to see some increased seasonal demand from India into the festival season, but Indian gold demand has been reserved recently and therefore it could take a stronger Indian currency to spur gold demand. Some Indian gold dealers are reportedly preparing incentives to spark demand into the coming festival season. At least to start today, gold is seeing somewhat adverse currency market action and perhaps a somewhat confusing impact from the early US equity market action. The gold market will probably continue to watch labor events in South Africa, as some strikers workers did not return to work and that company indicated earlier in the week, those not returning to work today, would be fired. Comex Gold Stocks were 11.209 million ounces down 32 ounces.

OUTSIDE MARKET DEVELOPMENTS: (6:00 AM CST) Chinese stocks were mostly higher again overnight, with Chinese data overnight providing a measure of improved confidence. Chinese GDP of +7.4% and Industrial Output gains of +9.2% apparently inspired some confidence in global economic prospects. However, European shares weren't overly inspired by the action and news from China, as stocks in Europe were mostly tracking sideways, perhaps because EU leaders are gathering for a two day summit to discuss budgeting, a bank supervisory Union and perhaps they will also discuss the creation of a currency commissioner. The markets were also presented with a rise in UK retail sales for September of +0.6% and therefore one could suggest that the outlook for the global economy continued to gradually improve overnight. In the US trade today, the markets will be presented with initial claims, which are expected to rise modestly, but the big question might be whether or not last week's big drop in claims will be readjusted after reports last week that one US state did not submit its weekly figures. The markets will also be presented with a Philly Fed Business survey, which is expected to make a minimal rise and the trade will also see a Leading Indicators Index, which is also expected to produce a minor improvement.

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