Compiled 02/03/12 6:00 AM (CT) Statistics: London Gold Fix $1,759.50 +$12.00 LME Copper Stocks 326,100 tons -2,575 tons Shanghai Copper stocks +48,246 tons to 179,891 tons SILVER MARKET FUNDAMENTALS: (6:00 AM CT) The silver market enters the Friday US trade sitting 23 cents an ounce under this week's highs and in a generally positive track for the week. The silver market appears to be following gold and equity market action this week and like a number of classic physical commodity markets, silver is looking to the US payroll report today for confirmation that the US economy was able to maintain positive motion. However, silver was probably supported in the wake of news that Peru silver production in December declined by just under 4% relative to year ago levels. Some traders are suggesting that bigger than expected declines in US claims and ongoing claims yesterday has fostered somewhat higher expectations for the payroll reading today, but some economists are warning of a possible negative balancing influence in the January numbers from the holiday period. Given the periodic lag in silver prices relative to gold prices, it is possible that the silver bulls might need a stronger payroll reading than the gold market to avoid a profit taking reaction. Comex Silver Stocks were 130.176 million ounces up 1,193,041 ounces. Comex Silver Stocks are now at the highest levels in a year, with silver stocks at the highest levels since 11/14/2008. Silver stocks have increased in 14 of the last 20 days. OUTSIDE MARKET DEVELOPMENTS: (6:00 AM CT) Asian equity markets were mixed this morning, with Shanghai stocks rising despite somewhat soft Chinese PMI readings. However, the Nikkei and Australian equity markets were weaker. European equities were generally higher off positive UK services PMI data. In the early action today, US equities are showing minimal gains to start, but movement is probably being limited ahead of the monthly US non farm payroll report. In retrospect, overnight data was somewhat soft but yet markets in Asia and Europe seemed to spin the news into a positive. Perhaps the trade is looking ahead to the US Non farm-payroll results, which generally have a range of estimates of gains from just below 100,000 to as high as 190,000. In addition to US Non farm payrolls for January, the US will also see a factory orders release and the ISM Non Manufacturing release for January. Expectations for both Factory Orders and the ISM non manufacturing readings generally call for modest gains but those readings might be partially overshadowed by the residual impact from the payrolls.
Join the Discussion