Compiled 05/25/12 6:00 AM (CT) Statistics: London Gold Fix $1,560.00 $+1.50 LME Copper Stocks 223,500 tons -575 tons. GOLD MARKET FUNDAMENTALS: (6:00 AM CST) At least in the early going today, it would seem like anxiety toward the Greek situation remains in place, but it has been moderated by somewhat up beat French and German Consumer confidence readings. It is also possible that many markets are becoming hopeful of an orderly Greek exit, as equities clawed out initial gains and gold was tracking higher this morning despite news of a poll that showed the extreme leftist party might have gained ground into the coming Greek elections. In other words, the market could have feared a political shift in Greece toward a leadership structure that won't honor prior promises to the EU. For gold and other physical commodity prices to see a Greek exit as a positive, they have to think that the exit will not be a sustained disruptive event. Weakness in the Indian currency this week has probably undermined investment interest in gold in that country but that negative could be easily countervailed this morning by suggestions from the Russian Central bank that they planned to buy a considerable amount of gold for reserves this year. Unfortunately, the Russian central bank last year only bought 100 tons of gold for reserve and therefore the size of the Russian buy might be a question mark for the gold trade. However, hints of central bank gold buying aren't usually discounted easily and with a stronger Euro initially today and marginally higher US equities early on, it would appear that the bull camp in gold does have the edge off outside market action. Gold might also see some minor support in prices off a reduction of gold futures margins overnight. If the reaction to US scheduled data yesterday is an effective guide, the bull camp will probably be pulling for some favorable news from the US consumer later this morning. Comex Gold Stocks were 11.002 million ounces up 96 ounces. OUTSIDE MARKET DEVELOPMENTS: (6:00 AM CST) Hong Kong shares finished marginally higher last night but that market still saw losses for the week. Mainland China stocks were down for the 3rd straight session, despite some strength in Chinese railway stocks. European equity markets were still showing concern toward the Greek situation as recent polls showing more gains were made among the far leftist party and that in turn seemingly increases the odds of a Greek exit from the EU. However, some favorable data from France and German consumer confidence overnight seems to have provided a minor boost in economic sentiment in that region and that could help Europe end the week on a less discouraging note. The US markets were showing minimal initial gains early this morning, as US data this week generally surprised with results that were slightly better than initial expectations. The US economic report slate is rather thin today, with an early speech from the Fed's Plosser in Germany and that will be followed later in the session by a Reuters University of Michigan consumer survey.
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