Compiled 01/14/11 6:00 AM (CT) Statistics: London Gold Fix $1369.25 -$11.50 LME Copper Stocks 376,225 tons -1,125 tons Shanghai Deliverable stocks were 132,647 tons +481 tons GOLD MARKET FUNDAMENTALS: (6:00 AM CST) The gold market wasn't able to get any support from a somewhat hot PPI headline reading yesterday and even more surprising is the fact that gold also doesn't seem to be benefiting from initial weakness in the Dollar this morning. In retrospect, gold saw its flight to quality hopes tamped down earlier this week by favorable Euro zone auction results and it is likely that the Chinese reserve requirement increase overnight is another element that is applying pressure to gold prices. While some might suggest that gold is being partially undermined by news of higher gold production from Fresnillo, modest gains in gold production just haven't been given much credence in this market. The gold bulls just can't seem to regain the upper hand in this market even though credit ratings agencies earlier this week warned of a possible US Credit downgrade in the event that deficit work isn't seen soon. Even more surprising is the fact that credit rating agencies overnight seemed to reaffirm the French rating, suggesting that country had more than enough internal funding capacity and that France had some time to work down their debt load. Some gold bears might suggest that some of the pressure in gold prices is the result of soft US Non Farm payrolls and the jump in US claims yesterday. In short, the gold market might need growth and inflation expectations running concurrently and currently only inflation seems to be a given threat. Comex Gold Stocks were 11.654 million ounces down 600 ounces. Gold stocks have declined 12 of the last 20 days. OUTSIDE MARKET DEVELOPMENTS: (6:00 AM CST) While equity markets in Asia were mixed during overnight trading, stock indices in Europe are generally weaker this morning. Early indications are for the US stock market to open slightly lower this morning. The Dollar is near unchanged levels against most of the major currencies during overnight trading. The Chinese central bank raised reserse requirements by 0.50% this morning, the fourth increase over the past two months. The French Economics Minister stated that the EU may be looking at increasing the size of their emergency rescue fund. Euro zone CPI during December was up 2.2% year-on-year, in line with expectations. UK PPI during December was up 4.2% year-on-year, higher than forecasts. Major US economic numbers this morning include December Retail Sales and the December Consumer Price Index released at 7:30 AM, December Industrial Production at 8:15 AM, a private survey of Consumer Sentiment during January released just before 9:00 AM, and November Business Inventories released at 9:00 AM. Fed regional Presidents Lacker and Rosengren will give speeches during the session.