Compiled 11/16/11 6:00 AM (CT) Statistics: London Gold Fix $1,773.00 +8.00 LME Copper Stocks 400,925 tons -2,325 tons GOLD MARKET FUNDAMENTALS: (6:00 AM CST) The gold market starts the Wednesday trade on a slightly weaker footing, as gains in the dollar and weak economic projections from the BOE overnight are weighing on gold and other physical commodity markets. In fact, statements from the BOE that economic growth in the UK was likely to be markedly weaker than was forecast in August, clearly weighed on gold and equity prices this morning. Gold might also be seeing some pressure from a series of comments suggesting that the Euro zone will eventually find the resolve to contain its debt crisis but that the crisis is likely to continue to hurt global sentiment in the near term. It is also possible that gold is partially undermined this morning because of talk that recent weakness in gold prices has failed to spark fresh value hunting buying interest in India. In retrospect, a contraction in the US PPI headline reading yesterday, might leave some gold traders fearful of the same impact from today's US CPI report, especially after the BOE and ECB officials overnight projected a weakening of inflation pressures ahead. Surprisingly the US Super Committee continues to fly under the radar of the media and the markets despite the fact that their deadline is quickly approaching. Given the apparent physical commodity market focus in gold this week, one might expect today's Industrial production and Capacity Utilization readings to provide some temporary support to gold prices. However, the gold bulls would seem to need favorable US numbers, optimism toward the Euro zone and perhaps even higher US equities just to throw off what seems to be a somewhat weaker initial bias. It also seemed as if adverse currency market action this morning was providing the bear camp in gold with yet another trade theme in the early going today. Comex Gold Stocks were 11.236 million ounces up 5,224 ounces. Stocks have declined 12 of the last 20 days. OUTSIDE MARKET DEVELOPMENTS: (6:00 AM CST) While equity markets in Asia were generally lower during overnight trading, stock indices in Europe are generally higher this morning. Early indications are that US equity markets will open weaker later on today. The US Dollar is moderately stronger against most of the major currencies this morning, although posting a small loss versus the Yen. UK Unemployment during October was 8.3%, higher than market expectations. Euro zone Inflation during October was up 3.0% year-on-year, in line with forecasts. Major US economic numbers to be released this morning include the October Consumer Price Index at 7;30 AM, October Industrial Production and Capacity Utilization at 8;15 AM, a private survey of US Housing at 9:00 AM, as well as a private survey of mortgage applications released before the opening. In addition, Fed Regional Presidents Lacker and Rosengren will speak during the session.
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