Compiled 04/23/12 6:00 AM (CT) Statistics: London Gold Fix $1,632.00 -$8.00 LME Copper Stocks 258,850 tons -2,300 tons GOLD MARKET FUNDAMENTALS: (6:00 AM CST) The combination of a weaker than expected Euro zone PMI readings and the prospect of leadership changes in France have started most physical commodity markets like gold off on a much weaker footing. Adding into the negative economic track is political and financial problems for the Dutch. While the markets could have fashioned a positive private manufacturing forecast for China overnight into a positive, that potential risk-on vibe wasn't embraced and global equity markets have come under rather definitive initial pressure. The bear camp might claim that the pattern of lower highs and lower lows on the charts has extended and that fears of slowing in the Euro zone, could leave gold and physical commodity markets under near term pressure. The bull camp has to hope that both the ECB and the US Fed will be quick to step in and revive the economic track with additional easing promises. Therefore the FOMC meeting this week will probably be a moderately important event for the gold trade. At least to start today, the gold market appears to be facing a risk off environment, where adverse currency market action might give the bear camp added resolve. Comex Gold Stocks were 10.903 million ounces down 92,159 ounces. Comex Gold Stocks are now at the lowest levels since 05/26/2011. The Commitments of Traders Futures and Options report as of April 17th for Gold showed Non-Commercial traders were net long 146,833 contracts, an increase of 3,134 contracts. The Commercial traders were net short 183,176 contracts, an increase of 3,035 contracts. The Non-reportable traders were net long 36,344 contracts, a decrease of 98 contracts. Non-Commercial and Non-reportable combined traders held a net long position of 183,177 contracts. This represents an increase of 3,036 contracts in the net long position held by these traders. OUTSIDE MARKET DEVELOPMENTS: (6:00 AM CST) Equity markets in Asia were weaker overnight, with the market unable to spin a positive Chinese manufacturing forecast into a distinct positive. European markets were also weaker to start today off fresh CDS and debt concerns from the Netherlands. Early in the US trade today, share prices were sharply lower, with the markets apparently seeing a continuation of Euro zone debt problems directly ahead. Adding into the negative vibe toward the Euro zone, was a weaker than expected Euro zone April services PMI result. While the US economic report slate today is effectively empty, many markets have seemingly started the new trading week in definitive risk off position.
Join the Discussion