Spot Gold Reaches One-Month Highs

Cassie Bastien

5/30/2017 12:37:44 PM

Daily Gold & Silver Market Report – 05/30/2017

After setting a one-month high early Tuesday morning, Gold rates eased on political worries surrounding Europe. Reuters Reporter Zandi Shabalala said the yellow metal “benefited from a risk-averse mood in global markets along with the Japanese yen and U.S. Treasuries.” A British election scheduled for next week, the potential of early elections in Italy and Greek debt concerns caused worry for many investors, which supported Precious Metals. Natixis Precious Metals analyst Bernard Dahdah said, “Ideally to see a rally in the (stock) markets the UK would want to see Theresa May win by an overwhelming majority which seems to be less likely to happen taking into account the latest polls.” Furthermore, Italy’s former Prime Minister Matteo Renzi suggested the Italian elections be held at the same time as Germany's. Shabalala says “Germany will vote on Sept. 24, while elections are due in Italy by May 2018.” ANZ analyst Daniel Hynes says, “ongoing political uncertainty in the market is really driving safe-haven buying at the moment.”

• U.S. Gold futures slipped 0.4 percent to $1,263.30 an ounce as the dollar firmed (Reuters.com).

Silver Continues To Lead

As of last Friday, Andrew Hecht with Seeking Alpha says, “the price of the volatile Precious Metal that tends to attract speculative interest was trading at $17.30 per ounce.” When it comes to the path of least resistance for Gold, Hecht says it is Silver that has been a leader in the 2017 Precious Metals market. According to analysts, “the most recent rally has taken Silver back to a high of $17.38 [per ounce] on May 26, an 8.2 percent gain.” Meanwhile, Hecht explains, Gold prices have been trading above their midpoint “from the highs at the end of April to the lows on the same day that Silver hit bottom but Gold's volatility leads it to have less dramatic price variance than [Silver].”

U.S. Stocks Slip from Record Highs

In addition to the euro slipping with equities in that region, the U.S. dollar “fluctuated as data showing a rebound in consumer spending offset a wider selloff in commodities,” causing stocks to end their seven-day growths, Bloomberg Markets Reporters Samuel Potter and Jeremy Herron said. “The S&P 500 Index edged lower from an all-time high as investors returned from a three-day weekend.” Additionally, crude oil prices slumped as investors awaited signs that cuts by the Organization of Petroleum Exporting Countries (OPEC) have reduced inventories. But it doesn’t stop there. Potter and Herron said “elections in the U.K., Germany and Italy are looming as Brexit negotiations begin, while U.S. President Donald Trump is ratcheting up a dispute with Germany and battling to implement future spending and tax-cut plans.” Federal Reserve Bank of St. Louis President James Bullard said Tuesday the new administration will need to fulfill the expectations that have driven the stock market higher, saying, “That is a concern going forward, whether the honeymoon period would end at some point and maybe the reality of American politics would settle in.”

• The S&P 500 slipped 0.1 percent to 2,413.29 at 10:49 a.m. in New York. The index is on track for its first decline in eight days after the longest rally since February.
• The Nasdaq 100 Index advanced for an eighth day to an all-time high. Amazon.com Inc. briefly topped $1,000 a share for the first time before trading little changed (Bloomberg.com).

At 1:37 p.m. (ET), the APMEX Precious Metals spot prices were:

• Gold, $1,265.50 Down $5.40
• Silver, $17.52 Up $0.09
• Platinum, $943.90 Down $21.50
• Palladium, $807.00 Up $15.30

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