Closing Gold & Silver Market Report, 06/28/2012
OIL, OTHER COMMODITIES SLIDE ON EUROPEAN FEARS
Most commodities, including Precious Metals and oil, ended the day with lower prices. Prices were pushed down by a stronger American dollar and fears of a continued lack of resolution to the eurozone crisis. Oil ended the day at the lowest price in eight months as it closed below $80 per barrel. Dan Flynn, a trader at Price Futures Group in Chicago, when interviewed by Bloomberg News, said, “We’re not getting a lot of good news with the economy.”
Part of the reason for the drop in prices is the summit among European leaders, who are desperately trying to stop the bleeding from Europe’s wounded economy. “The mood is one part hope, one part trepidation, and one part fear that there will be a lack of resolution at this latest meeting, which is probably a fair (to optimistic) assessment,” wrote Matt Smith, analyst with Summit Energy.
The American economy is on shaky ground, a statement that should surprise no one, but was particularly well outlined in a recent Reuters article. According to analysis of first quarter GDP growth, more than half of the growth of GDP in the first quarter came from pent up demand from the automobile sector, demand that since has waned. Data show that GDP growth in the first quarter, excluding this demand from the auto industry, was a measly 0.7 percent. This looks particularly worrisome when compared to the GDP growth of the fourth quarter of 2011, a relatively robust 3 percent. “It highlights that the U.S. is not immune from the weakness in the rest of the world. Corporate profits are likely to remain under pressure, a development that is unlikely to help the employment outlook,” said Jeremy Lawson, a senior economist at BNP Paribas in New York. This decline in auto demand correlates with the price decline for Platinum and Palladium, which are key ingredients in automobile components.
At 5 p.m. (EDT), the APMEX Precious Metals spot prices were:
- Gold, $1,554.30, Down $25.60.
- Silver, $26.37, Down $0.70.
- Platinum, $1,390.00, Down $21.70.
- Palladium, $567.50, Down $13.30.
APMEX’s Account Managers now have extended hours Mondays through Thursdays and are here to serve you until 8 p.m. (EDT)! Or call us Fridays until 6 p.m. (EDT)! If you have any questions about investing in Precious Metals or simply would prefer to place your order by telephone, we are here to help.