Morning Silver Market Report 9/13

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Compiled 09/13/12 6:00 AM (CT)

Statistics: London Gold Fix $1,730.50 -6.50 LME Copper Stocks 216,425 tons +550 tons

SILVER MARKET FUNDAMENTALS: (6:00 AM CT) The silver market was slightly easier overnight, as it awaited the results of today's FOMC meeting, which are expected to be announced at 11:30 am central today. The bulls may already be disappointed with silver's performance yesterday, as it sold off sharply after making new highs overnight. Like gold, silver had gained quite a bit in recent weeks on poor economic data and on expectations that the Fed would be embarking on a third round of quantitative easing. The market also got a boost yesterday from the German High Court's ruling in which it did not block the ESM, a permanent bond-buying rescue program for the EU.

All seems to be riding on the FOMC meeting this morning, and if the Fed comes up short of announcing an imminent QE III, the market could sell off sharply. Silver is likely to be led by gold if the report is bullish, but the poor closing in silver yesterday makes the bulls nervous, and it appears that the report would have to exceed expectations for the market to avoid a correction.

Comex Silver Stocks were 141.188 million ounces up 509,602.

OUTSIDE MARKET DEVELOPMENTS: (6:00 AM CT) Asian equity markets posted mixed results during overnight trading, with the Nikkei up 0.39% while the Shanghai A Share Index was down 0.76%. European stock indices are generally lower this morning, with Spanish equities down by more than 1%. US stock futures are posting moderate losses coming into this morning's trading, while the Dollar is slightly lower for the day. Today's US economic data will include readings on Weekly Jobless Claims and the Producer Price Index for August.

The Federal Reserve's Open Market Committee will announce changes to US monetary policy as well as a potential new program of quantitative easing measure this morning. Fed Chairman Bernanke will have a post-meeting press conference this afternoon.

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*Disclaimer: The information in the Market Commentaries was obtained from sources believed to be reliable, but we do not guarantee its accuracy. Neither the information nor any opinion expressed therein constitutes a solicitation of the purchase or sale of any futures or options contracts.

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