Daily Gold & Silver Market Report–3/9/2016

Marcey Hollon

3/9/2016 11:04:50 AM

GOLD FALLS, STOCKS RISE ON ECB EASING; OIL RECOVERY DRIVES WALL STREET RALLY

The European Central Bank meets Thursday but expectations of continued monetary easing has softened the euro while equities rose 1 percent. Gold managed to hit a 12-month high yet is being held down by a rising dollar. The dollar benefits from the euro being down and a rising stock market, while Gold is pressured by rising interest rates. "If the [European] bank does meet market expectations, the euro should weaken and the dollar should strengthen, so we should see dollar Gold testing the downside," Societe Generale analyst Robin Bhar said. "I suspect we are in a broad $1,240-$1,280 [per ounce] range ahead of some event risk in the guise of the ECB tomorrow. … Then the big event risk, of course, is the FOMC (U.S. Federal Open Market Committee) meeting next Tuesday, and the decision on Wednesday." Expectations by analysts that March would serve as a tip-off date for the Federal Reserve to raise rates has been curbed by instability in the global market.

The possibility of major oil producers agreeing to a freeze has Wall Street rallying Wednesday. While some investors are skeptical oil can sustain a recovery due to the oversupply, Brent crude managed to hover above the $40 per barrel mark. "Obviously, it's about oil prices," First Standard Financial Chief Market Analyst Peter Cardillo said. "The market is probably going to have an upward bias for most of the session as investors await the ECB (decision) tomorrow." The European Central Bank meets Thursday and is expected to increase its stimulus program. The U.S. Federal Reserve meets March 15-16 and will discuss the continued possibility of raising rates gradually throughout the year.

 

At 12:03 P.M. (ET), the APMEX Precious Metals spot prices were:

• Gold, $1,256.20 Down $8.40
• Silver, $15.44 Up $0.00
• Platinum, $982.00 Down $7.40
• Palladium, $567.10 Down $0.70

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