Compiled 04/19/12 6:00 AM (CT) Statistics: London Gold Fix $1,642.50 -$4.50 LME Copper Stocks 262,700 tons +1,550 tons GOLD MARKET FUNDAMENTALS: (6:00 AM CST) While the bear camp might be cheered by the lower low initially forged on the charts overnight, gold prices have managed to right the ship and claw back into positive ground in the wake of the Spanish auction results. While it doesn't appear as if the auction results were favorable enough to push the markets into a definitive risk-on posture, a slightly higher yield was tolerated because of solid demand or the bid to cover on the Spanish Note offering. Gold might also be garnering some support this morning from minimally favorable Indian physical gold demand talk. Apparently gold demand ahead of a festival in India is starting to rise, after some initial concern that Indian demand was going to remain weak. Other issues that might be lending minor support to gold prices overnight are hints that the PBOC might be poised to lend some liquidity to its markets, that Russian Central Bank gold and Forex reserves increased and the hope that US scheduled data later today will foster some growth talk. However, countervailing the upside tilt today is a prediction from Indian officials that overall Indian gold imports this year will probably moderate from last year. News that African Barrick was planning to expand its back up power capacity to 100% at a troubled mine, might be seen as an eventual supply side negative for gold prices but recently gold hasn't paid that much attention to minor changes in the supply side of the equation. In looking ahead, the bull camp needs positive US data and positive US equity market action to make sure the European debt news overnight is left in the rear view mirror. Comex Gold Stocks were 10.994 million ounces down 33 ounces. Stocks have declined in 12 of the last 20 days. OUTSIDE MARKET DEVELOPMENTS: (6:00 AM CST) Equity markets in Australia and Hong Kong were higher overnight, with rumors that the PBOC might be set to provide some liquidity to its economy. Asian investors really didn't have that much time to react to the Spanish auction results. European markets were higher to start today on the mostly acceptable Spanish auction results but the markets were also falling back from those initial highs into the US opening. Early in the US trade today, share prices were mostly higher, with the markets generally relieved with the European debt auction results. The US economic report slate today is very active, with initial and ongoing claims, existing home sales, leading indictors and a Philly Fed manufacturing result. Expectations call for a decline in claims, a slight improvement in existing home sales and a decline in the Philly numbers. The US earnings parade will also continue with the general influence of the earnings coming in as a positive for most physical commodity markets.
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