Statistics: London Gold Fix $1,755.25 -$8.50 LME Copper Stocks 220,075 tons -450 tons
GOLD MARKET FUNDAMENTALS: (6:00 AM CST) After the sharp range down washout yesterday the December gold contract appears to be getting a technical bounce this morning. In fact, in the early US Thursday trade action, December gold was trading as much as $23 an ounce above the prior session's lows. While the Chinese move to add funds to their economy seems to have provided a countervailing force to the drum beat of global slowing this week, news that Indian gold importers were still thought to be balking at gold purchases is probably restricting the upward track in gold prices this morning. However, gold is probably given some fresh lift from news of a Chinese investment in an Australian gold mining company. Not surprisingly inflows into a gold derivative instrument yesterday were lower, as the sharp washout in gold prices this week apparently discouraged investors. In looking forward the risk-off crowd might be emboldened again, if US Durable goods results match expectations that are calling for a noted decline in a key US report. However, US claims figures could serve to cushion the fear toward the economy today if either claims or ongoing claims manage to fall. In the end, the bull camp was probably thrown a temporary life line from the Chinese moves overnight, but the action in equities into the European close, might end up being the real test of the gold trend for the remainder of the US trading session. Comex Gold Stocks were 10.904 million ounces up 6,699 ounces. Stocks have declined 11 of the last 20 days.
OUTSIDE MARKET DEVELOPMENTS: (6:00 AM CST) Chinese equity markets were stronger overnight, as the PBOC stepped up and provided a serious injection of funds ahead of an upcoming Chinese holiday. While the Chinese move provided a cushion for European equity markets, recent protests in Spain and Greece combined with another rise in the German September jobless figures to generally leave sentiment toward the Euro zone on the rocks. While the US stock markets were showing positive initial action today, the expectation of slowing remain in place and the markets might be poised to take a lot of direction today from US claims and from an advanced US durable good result that could register a significant contraction. In short, the Chinese stimulus move overnight might be overshadowed by fresh slumping US data.
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