Closing Gold & Silver Market Report – 10/4/2011
STOCK & PRECIOUS METALS MARKETS SURGE IN MASSIVE LATE DAY RALLY
Markets posted massive gains this afternoon as the S&P 500 climbed by 4.1% and gold rebounded by more than $20 off its low of around $1,600. Silver is closing above $30 after dipping below $29 this afternoon.
The market continues to suffer from headline risk – the tendency to swing wildly based on whatever news is breaking at the moment – and demonstrated it this afternoon. It was reported that European Union (EU) finance ministers agreed to a bank bailout to rescue financial institutions in the event that the dominoes set in place by the sovereign debt of several EU states start to fall. Speaking at a press conference, Wolfgang Schäuble, the German Finance Minister said, “Everyone said the big concern is that worrying developments on the financial markets will escalate into a banking crisis. It’s clear now that the European banking system needs to be strengthened and needs more capital.”
Greece also looks to be (slightly) further away from bankruptcy, which could be another force acting on the markets this afternoon. “Until mid-November it is clear there will be no problem,” said Greece’s Finance Minister, Evangelos Venizelos. What will happen at that time remains to be seen. The Greek population is struggling to accept the new round of austerity measures required to receive the next round of aid.
At 4:00 pm (CT) the APMEX precious metals spot prices were:
- Gold - $1,627.90 – Down $31.80.
- Silver - $30.20 – Down $0.65.
- Platinum - $1,481.00 – Down $36.10.
- Palladium - $568.60 – Down $27.10.