Compiled 10/19/11 6:00 AM (CT) Statistics: London Gold Fix $1,651.00 -$7.00 LME Copper Stocks 452,175 tons +250 tons GOLD MARKET FUNDAMENTALS: (6:00 AM CST) The bull camp had to come away from the action yesterday disappointed, as a sharp rally in equities and perhaps some measure of optimism toward the Euro zone could have lifted gold and other physical commodity markets yesterday. After tracking like a physical commodity market recently, the action in the gold market yesterday might hint at another change in market focus. In fact, with a slightly weaker US dollar this morning one might have expected gold to have found some favor this morning, but instead gold was seemingly content to waffle. While the market will see a series of US Fed speeches today, the US housing starts release might be the key release of the session, as that figure might be the best measure of the state of the US economy. The trade will also see a CPI release and while that release comes in the wake of a rather hot PPI report in the prior trading session, the trade doesn't appear to be in a position to react sharply to classic inflationary news. In other words, the markets are seemingly more concerned about recession than the fear of inflation. News of a rise in Chinese gold holdings overnight was probably somewhat supportive of gold prices, but recently the gold trade hasn't been overly interested in classic supply side stories. In fact, news of a rise in 3rd quarter gold production from Gold Fields didn't seem to be given that much interest overnight and that again highlights the markets focus on the ebb and flow of investment demand. After yesterday's action, the gold trade seems to have been weakened because of Chinese and Euro zone slowing fears and it remains to be seen if favorable US numbers and strength in US equities will improve sentiment markedly toward gold. Comex Gold Stocks were 11.248 million ounces up 128,560 ounces. Stocks have declined 13 of the last 20 days. Comex Gold stocks are at their highest levels in the past 10 sessions. OUTSIDE MARKET DEVELOPMENTS: (6:00 AM CST) While equity markets in Asia were mixed during overnight trading, stock indices in Europe are generally higher this morning. Early indications are that US equity markets will open close to unchanged levels later on today. The US Dollar is generally weaker against most of the major currencies this morning, although posting a small gain versus the Yen. US tech stock Apple released their third quarter earnings after yesterday's close, which were below analyst expectations for the first time since 2001. A major credit ratings agency downgraded Spain's credit rating by two levels overnight. There is a general strike in Greece this morning, as that nation's Parliament prepares to vote on additional public sector cuts. Foreign direct investment in China during the first three quarters of 2011 was up 16.6% above 2010 levels. The Federal Reserve will release their latest edition of the Beige Book at 1:00 PM. Major US economic numbers to be released this morning include the September Consumer Price Index and September Housing Starts at 7:30 AM, and a private weekly survey of mortgage applications released before the opening. In addition, Fed Regional Presidents Rosengren and Lockhart will give speeches during the session today.
Join the Discussion