Mid-Day Gold & Silver Market Report – 12/19/2013
Ted Prince
12/19/2013 12:07:00 PM
ETF-SELLOFF PUSHES GOLD FURTHER DOWN
The Gold price has fallen on continued pressure from news that the Federal Reserve is ready to begin tapering its current level of asset buying by $10 billion per month. In the recent past, Gold and Silver have benefited from the monthly purchases of $85 billion worth of treasury and mortgage-backed securities. However, many were surprised by yesterday’s Fed announcement as a number of analysts and economists were forecasting an initial taper announcement for spring 2014. "Heavy ETF selling has been seen all week, and it appears likely will continue into year-end, and into the 2014," MKS Finance said in a note. "ETFs have declined in excess of 300,000 ozs Gold this week alone, which also witnessed the largest single day outflow since last October." Heavy ETF selling usually means strong physical buying as the time horizon for a buyer of Gold coins and bars tends to be longer-term. Many investors of physical Gold and Silver are taking advantage of today’s price dip.
Following yesterday’s massive rally on the heels of the Fed’s stimulus taper statement, U.S. stocks have cooled after a round of profit-taking and weak employment numbers. “You had such a sky-rocket yesterday in equities after the Fed announcement and really nothing has changed,” Timothy Ghriskey, chief investment officer at Solaris Group LLC, said. “There’s a little bit of profit-taking off of that emotional spike. The other reason is it happened soon after the weekly unemployment numbers. A couple of weeks ago that bad news would have been looked at as good news by the market because it would have meant the Fed wouldn’t act. Bad news now is becoming bad news for the market.” Investors will continue to watch markets as volatility is expected for both Gold and equities through year-end.
At 1:05 p.m. (ET), the APMEX Precious Metals spot prices were:
- Gold, $1,197.40, Down $40.10.
- Silver, $19.28, Down $0.84.
- Platinum, $1,322.80, Down $22.90.
- Palladium, $696.00, Up $3.50.
APMEX Market Reports provide our readers with a review of spot price activity and some of the factors that may be affecting the market for Precious Metals. While the information is obtained from sources we believe to be reliable, we do not guarantee its accuracy or its completeness and we encourage you to conduct your own investigation prior to making any decision based on the information. The Market Reports are not intended as a comprehensive discussion and there may be other factors affecting the financial marketplace. These Market Reports are provided for informational purposes only and do not constitute a recommendation by APMEX to hold, purchase or sell any Precious Metal product. All orders, purchases and sales, if any, are subject to the terms of the User Agreement and other applicable policies
