Compiled 07/26/11 6:00 AM (CT) Statistics: London Gold Fix $1,610.00 -$8.50 LME Copper Stocks 469,100 tons -2,100 tons GOLD MARKET FUNDAMENTALS: (6:00 AM CST) The gold bulls have to be a little disappointed with the lack of additional upside action last night, especially in the wake of the latest US display of failed leadership on the debt ceiling debacle. In addition to "no deal" from Washington, the global markets also saw the prospect that the eventual compromise deal will only offer minimal spending cuts. There is talk that the magnitude of the spending cuts offered will simply increase the odds that credit ratings agencies in the near future will be forced to lower the US credit rating. The market didn't seem to be overly interested in news that South African Mines were facing a strike, as the news flow from Washington has become very dominating. Fears of extreme volatility in Treasuries could embolden some gold bulls, as the world increases its attention on the credit rating of the world's largest debtor. With some political experts suggesting there is still a couple more days before the point of no return is passed on the debt ceiling, which could leave Washington wriggle room to debate for a couple more trading sessions. It is possible that a hike in Indian interest rates overnight was partially responsible for some profit taking action in gold overnight but the influence of international developments should wane quickly once the fresh news flow from Washington resumes for the day. Comex Gold Stocks were 11.433 million ounces down 32 ounces. Stocks have declined 12 of the last 20 days. OUTSIDE MARKET DEVELOPMENTS: (6:00 AM CST) While equity markets in Asia were generally stronger during the overnight session, stock indices in Europe are generally weaker this morning. Early indications are that US equity markets will open slightly lower later on this morning. The US Dollar is weaker against most of the major currencies this morning. India's central bank lifted interest rates by 0.50%, higher than expectations. UK GDP during the second quarter was up only 0.2%, in line with expectations. A private survey of German consumer sentiment during July was 5.4, lower than forecasts. A private survey of French consumer sentiment during July was at 86, higher than market projections. Major US economic number to be released this morning will be a private survey of US Home Prices at 8:00 AM, June New Home Sales as well as a private survey of US Consumer Confidence at 9:00 AM, as well as private surveys of store sales released during the session. In addition, Fed Regional President Hoenig will give a speech during the session. There will also be results of the Treasury's 2-Year Note auction announced at 12:00 PM.
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