Morning Gold & Silver Market Report – 3/22/2012
GOLD LOWER ON PROFIT-TAKING; CHINA’S ECONOMY CONTRACTING?
Precious metals fell in overnight trading, as less-than-promising Chinese factory data has caused many investors to cash out their positions for profit-taking purposes. Many investors are awaiting European data to see how the eurozone is faring after the Greek bailout deal. Yuichi Ikemizu, head of commodity trading, said, “A lot of people are on the sidelines at the moment. … We saw some bearish signs, but the market seems to be holding well. The upside at $1,800 is still looking quite heavy, and investors are waiting for a cue.”
Chinese factory data continues to decline, falling from a PMI rating at the end of February of 49.6 to a preliminary 48.1 for the month of March. The PMI rating is based on a 100-point scale, with 50 being the divider between growth and contraction. Based on the latest data, China’s economic outlook is worsening. HSBC economist Hongbin Qu said, “Weakening domestic demand continued to weigh on growth, as indicated by a slowdown in new orders, which came in at a four-month low. More worryingly, employment recorded a new low since March 2009, suggesting slowing manufacturing production was hindering enterprises’ hiring desire.”
In a surprising turn of events domestically, jobless claims continued to fall. Although still not at levels economists are looking to achieve, this development is still viewed as a good sign. The four-week moving average, a better measure of labor market conditions, declined 1,250. Employers also are hiring more, adding 227,000 jobs in February.
At 8:18 a.m. (CDT), the APMEX precious metals spot prices were:
- Gold - $1,635.60 – Down $16.20.
- Silver - $31.59 – Down $0.67.
- Platinum - $1,616.10 – Down $25.30.
- Palladium - $666.00 – Down $22.60.
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