Mid-Day Gold & Silver Market Report – 9/27/2011
GLOBAL STOCKS SURGE, BUT DIFFICULTY LOOMS
Precious metals are on the rise since the Morning Gold & Silver Market Report. The rise has been fairly brisk amid talks of global stock markets’ overall rise and tempered by uneasy talks on eurozone bailout.
Global stock markets have rallied the most since May of 2010. The euro also climbed against the dollar, which tends to support the price of gold. Mohamed El-Erian, CEO of PIMCO said that European leaders “finally get it…They recognize they have deep problems and they recognize they need to do something about it. This was a very important wake-up call for Europe.” U.S. Treasury Secretary Timothy Geithner, also predicts more forceful action from European governments to resolve the European debt crisis.
The main issue at this point revolves around the presumption of a bailout to increase confidence in the markets. Chancellor Angela Merkel of Germany is still having a lot of difficulty uniting her coalition behind even the smallest of aid steps. A crucial vote is expected Thursday. Greece continues to be the albatross, however, Greek Prime Minister George Papandreou has come out with the bold proclamation, "I can guarantee that Greece will live up to all its commitments." Merkel spoke towards this issue as well, stating, "We will provide all the help desired from the German side so that Greece regains trust."
The dollar softening to the euro has helped increase the price of gold. "Given that we haven't had any correction for months, this has brought better value to the market for people who want to get back into gold," said Credit Agricole analyst Robin Bhar. "I think gold's bottomed out here. Longer term, have all the factors that were bullish for gold really been addressed? Currency debasement, economic imbalances, sovereign debt—the factors that were there last week are still here today."
At 12:06 PM (CT) the APMEX precious metals spot prices were:
- Gold - $1,660.20 – Up $64.40.
- Silver - $31.93 – Up $1.93.
- Platinum - $1,577.60 – Up $27.70.
- Palladium - $652.50 – Up $23.10.