Compiled 02/16/11 6:00 AM (CT) Statistics: London Gold Fix $1374.50 +$2.25 LME Copper Stocks 405,800 tons +3,375 tons SILVER MARKET FUNDAMENTALS: (6:00 AM CT) The silver market was initially unable to claw out a fresh new high for the move overnight and that suggests that gold continues to be the leadership market. The silver market might be garnering some support from news that Pan American Silver expects to see their 2011 silver production decline, but silver recently hasn't paid that much attention to classic supply side developments. In other words, silver seems to be looking over its shoulder to the action in gold, as inflation and uncertainty seem to be dominating silver price action, instead of classic physical commodity market fundamentals. In fact, recent weakness in copper and oil prices has probably served to undermine bullish sentiment in silver somewhat over the last two weeks. While silver hasn't been paying that much attention to the pace of the economy, the bull camp in silver probably needs to see decent US Housing numbers and something at least moderately hot from the PPI report to maintain a positive track in prices this morning. Comex Silver Stocks were 102.838 million ounces up 74,519 ounces. Silver stocks have declined 12 of the last 20 days. OUTSIDE MARKET DEVELOPMENTS: (6:00 AM CT) While equity markets in Asia were mixed during overnight trading, stock indices in Europe were generally stronger this morning. Early indications are for the US stock market to open with moderate gains this morning. The Dollar is weaker against most of the major currencies during overnight trading. An official Chinese newspaper said that China should let the Yuan continue to rise in order to curb imported inflation. The Egyptian military said that it wishes to hand over power to an elected government within 6 months. The head of the World Bank said that global food prices had reached dangerous levels. UK Unemployment during December was 7.9%, in-line with forecasts. Major US economic numbers to be released this morning include January Housing Starts and the January Producer Price Index at 7:30 AM, January Industrial Production at 8:15 AM, and a private survey of mortgage applications released before the opening. In addition, the minutes from the January 26th FOMC meeting will be released at 1:00 PM.
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