Mid-Day Gold & Silver Market Report – 10/17/2012

Nicholas Wilsey

10/17/2012 12:02:00 PM

GOLD HOVERS; U.S. SHOWS IMPROVEMENT

Gold is up slightly today, but over the past few weeks the Precious Metal has been relatively flat. The upcoming U.S. presidential election and economic turmoil in Europe have been two of the main culprits for the lack of any notable movement in the market. One of the reasons for the slight bump in price today has been due to the European Union summit that is being held this week. "Some minor positives from Germany relating to Spain and also their retention of investment grade for Spanish bonds helped gold somewhat," George Gero, Precious Metals strategist at RBC Wealth Management, wrote in a note.

The two-day European Union summit started and there is a lot to discuss, with the focus being agreeing on a single supervisor for all the eurozone’s banks. This is not an easy proposition for many countries who feel they would be losing control over their central banks. German Finance Minister Wolfgang Schaeuble was quick to point out the urgency of getting a plan in place. "We must now make bigger steps in the direction of a fiscal union," Schaeuble said. While all involved agree in the need to move forward, not everyone agrees on the method of doing so. 

The United States had another positive report that could signal economic recovery. Housing starts jumped 15 percent in September, the fastest pace since July 2008. Housing markets have been known to indicate the direction of the economy. While the gain is not record-breaking, it does show promise for the future. "One of the big headwinds for the economy has been the weak housing market and this indicates that headwind has dissipated," said Gary Thayer, an economic strategist at Wells Fargo Advisors in St. Louis, Missouri.

At 1 p.m. (EDT), the APMEX Precious Metals spot prices were:

• Gold, $1751.70, Up$5.90.
• Silver, $33.24, Up $0.26.
• Platinum, $1664.10, Up $21.90.
• Palladium, $654.50, Up $14.60.

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