Closing Gold & Silver Market Report – 5/28/2014

Ted Prince

5/28/2014 4:29:00 PM

PALLADIUM REACHES 3-YEAR HIGH AS SOUTH AFRICAN MINER STRIKE CONTINUES

The Gold price seeped further down today on easing geopolitical tensions following news that Russia will not interfere with Ukraine’s vote for new leadership.  While Gold struggles to find solid footing, Palladium has reached its highest price since 2011, climbing 13 percent since a South African miner strike that began January 23 has virtually halted production of Palladium.  The nation is the world’s second-largest producer of Platinum and Palladium and the failure of labor unions and South African mining companies to reach a consensus regarding worker’s wages seems to be an ever-present concern in the region.  “People are betting on higher prices because of the South Africa situation,” Phil Streible, a senior commodity broker at R.J. O’Brien & Associates in Chicago, said in a telephone interview. “The fundamentals are very supportive.”  As Palladium prices rise, many speculators view the metal as a bullish bet as fund managers are beginning to increase their positions in the form of exchange-traded funds. 

Following a four-session rally that saw the S&P 500 reach another record high, U.S. stocks are down as investors take gains.  Today’s mild dip comes ahead of key reports from the U.S. Commerce Department.  Economists predict the report will show a contraction of 0.5 percent in the U.S. economy during the first quarter.  “People are focusing on the GDP number tomorrow,” John Traynor, chief investment officer of People’s United Bank Wealth Management, said. “There are two camps of investors. They seem to fall down on the side of, ‘Is the economy at a point where it reaches a self-sustaining path?’” 

At 5:30 p.m. (ET), the APMEX Precious Metals spot prices were:

• Gold, $1,260.80, Down $6.90.
• Silver, $19.02, Down $0.05.
• Platinum, $1,457.00, Down $6.30.
• Palladium, $837.00, Up $5.50.