Compiled 06/29/12 6:00 AM (CT) Statistics: London Gold Fix $1,569.50 +$1.75 LME Copper Stocks 257,150 tons +1,050 tons GOLD MARKET FUNDAMENTALS: (6:00 AM CST) The gold market has managed a recovery bounce overnight but it should be noted that type of action was seen on several occasions earlier this week, but unfortunately gold prices eventually finished weaker on several occasions. However, the reason for the bounce overnight is somewhat more substantial as the near term threat against Italy and Spain was reduced by the actions of the EU and many outside market forces have also shifted back into a more supportive role for gold prices. In fact, a sharp rise in crude oil prices and ongoing concerns of inflation from the grain complex might begin to offer some type of fresh argument against periodic broad based deflationary fears. Gold also saw some fresh buying from Indian players overnight and recently Indian and Chinese players have showed very little capacity to influence the world gold market. Some bear traders are suggesting the gains today are merely month-end technical short covering and that the gold trend remains down, with gold prices more than likely poised to carve out their 5th straight monthly decline with the close today. Investment flow into gold derivative investments fell yesterday, but it is possible those instruments will be set to play catch up today with some fresh inflows. With the EU situation temporarily giving off the illusion of being solved that in turn should allow the focus of the gold trade to move back to the state of the US economy. The big question for the gold trade today, is whether or not the bull camp will be able to lift gold prices even further off weak US data and rekindled expectations of US easing? With distinctly supportive currency market present in the early going today that could give the supposed month-end short covering impetus an added boost. Comex Gold Stocks were 10.994 million ounces down 69,534 ounces. OUTSIDE MARKET DEVELOPMENTS: (6:00 AM CST) Hong Kong stocks managed to end the quarter on an up note overnight, while the Shanghai market managed to break an extended losing streak with a gain last night. European stocks were also positive this morning and in the process some measures reached up to the highest levels in over a week. Clearly seeing a surprise move to reduce borrowing costs for Italy and Spain provided the enthusiasm to lift share prices this morning. The US scheduled report slate today will bring forth personal income and spending, Chicago PMI and a University of Michigan sentiment reading. Expectations for most of the reports today call for weak data, but it would seem like the weakest report reading is expected to come from the consumer sentiment report.
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