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Market Nuggets: Friday Marks Two-Year Anniversary Of Gold’s All Time High

Friday September 6, 2013 10:39 AM

Analysts at TD Securities note that Friday’s marks the two-year anniversary of when gold prices hit their all-time high of $1,921. They add that the recent move in U.S. treasury yields, which is gold negative, highlights the change in the economic climate in the last two years. “U.S. 10-year treasury yields this morning traded at 3.00% for the first time in just over two years - back on Sept. 6, [2011] the 10 year was trading at 1.98% while the DXY was at 75.25 versus today's 82.50 level and the S&P 500 was at 1165 versus the 1655 close of last night,” TDS says. “Gold is suffering in this environment...”

By Neils Christensen of Kitco News; nchristensen@kitco.com

 

Market Nuggets: Traders Stay Away From Gold As They Wait For News On Syria – RBC

Friday September 6, 2013 10:39 AM

Apparently Syria is on everyone’s mind, which George Gero, vice president with RBC Capital Markets Global Futures, says could keep traders away from markets, and expects to see some short-covering as traders prepare for the weekend. “Traders seem unwilling to take new positions until the Syrian problems clarify and bonds stabilize after a rate climb,” he says. “We need a close over $1,400 now for more positive re-entry for some of the traders.”

By Neils Christensen of Kitco News; nchristensen@kitco.com

 

Market Nuggets: Tapering Could Still Happen – Nomura

Friday September 6, 2013 10:39 AM

Tapering is still on the table despite Friday’s weaker-than-expected employment report, says analysts at Nomura. “We believe this employment report today along with other data we received this week will keep the FOMC on track to begin tapering its asset purchases at the September meeting. We expect the FOMC to continue to stress that future decisions on its path of purchases are data dependent,” they say. The Bank also points out that the bar has been set fairly low for tapering; however, after Friday’s report the central bank could taper less than expected. “It is also possible that they could change the composition of tapering, i.e., not taper MBS initially,” the bank says.

By Neils Christensen of Kitco News; nchristensen@kitco.com

 

Market Nuggets: ‘Weak’ Employment Report Won’t Change Expectations for Taper in September – CIBC

Friday September 6, 2013 9:07 AM

Peter Buchanan, senior economist at CIBC World Markets, says he didn’t see a lot of good news in Friday’s employment report but it won’t change his expectations for tapering in September. “U.S. nonfarm payrolls disappointed for a second straight month, with the headline printing at 169K, 11K short of expectations and a sizeable 74K downwards revisions to the preceding two months, including a cut in July’s rise to a tepid 104K. The unemployment rate unexpectedly fell a tick to 7.3% but the decline was not really a good news story, reflecting a decline in the labor force participation rate,” he says. “A somewhat weak report overall, but likely not soft enough to change consensus expectation for a move to taper at this month’s FOMC.” Buchanan adds the report should boost Treasury markets and drag down the U.S. dollar and equity markets.

By Neils Christensen of Kitco News; nchristensen@kitco.com

 

Market Nuggets: Fed, Syria Could Keep Markets On Defensive – RJ O'Brien

Friday September 6, 2013 7:25 AM

Markets are focused on Friday’s U.S. nonfarm payrolls report, set for release at 8:30 a.m. EDT. The general consensus is that the Labor Department will say 180,000 jobs were created, with unemployment rate holding at 7.4%.  “This will be the last employment report before the all important Fed meeting on Sept. 17-18, where stimulus-tapering is expected to be announced.  A strong employment result will seal the deal and give Benny of the Fed (Federal Reserve Chairman Ben Bernanke) every good reason to reduce the speed on that stimulus pedal as he steers his way towards the exit ramp,” says Janet Mirasola, managing director at R.J. O’Brien. After the report is released, Mirasola says the markets may look toward news out of the Group of 20 meeting as President Obama struggles to gain support from others the for a military strike against Syria. “Stimulus tapering and the congressional vote to strike against Syria could give traders reason to reduce risk across the board keeping markets on the defensive at least until the Fed meeting later this month,” she says.

 

Market Nuggets: Gold Market Puts Syria Concerns On 'Backburner' – Walsh Trading

Friday September 6, 2013 7:23 AM

Gold markets are watching the situation in Syria, and while still concerned over “the U.S. threats to attack the Assad regime in Syria, there is a lot of speculation that any attacks wouldn’t begin until late next week or the week after” when Congress meets, says Walsh Trading. News reports say it is unclear when the House of Representatives will vote next week. “That brings back economic data released in the U.S. and globally back to the forefront with Syria temporarily on the backburner for now.” The current weakness in gold is “nothing more than profit taking” ahead of the jobs report and what it might mean for Fed action.

By Debbie Carlson of Kitco News; dcarlson@kitco.com

 

Market Nuggets: Chinese Gold Imports From Hong Kong Rise – HSBC

Friday September 6, 2013 7:23 AM

China’s gold imports from Hong Kong rose to 129 metric tons in July from 112 tons in June, according to the Hong Kong Census and Statistics Department, HSBC says. This was the second highest month on record and an increase year-over-year from 76 tons in July 2012.China’s gold exports to Hong Kong increased slightly, to 16 tons in July, from 12 tons in June this year but fell from 30 tons in July 2012, respectively, according to the trade data. On a net basis, China’s gold imports from Hong Kong totaled 113 tons in July this year, more than double net imports of 46 tons in July last year. “Physical gold demand in China has clearly picked-up in July after gold prices hit the year-to-date low of $1,181/oz on June 28. This increase in demand helped contributed to bullion’s price recovery to over $1,300/oz at the end of July. More recently, bullion’s premium on the Shanghai Gold Exchange, an indicator of demand, has softened to low double digits from the $20-30/oz range seen in July and August. However, the recent pull-back in gold prices sub $1,400/oz level may be an encouraging sign for price sensitive physical buyers to step back into the market. That said, China’s gold imports may remain at elevated levels for the medium term, in our view,” they say.

By Debbie Carlson of Kitco News; dcarlson@kitco.com

 

Market Nuggets: Movement Seen On South African Miner Pay Negotiations - Commerzbank

Frday September 6, 2013 7:22 AM

The South African National Union of Mineworkers says it has received an improved offer from employers, though it has not released any details, says Commerzbank, suggesting that talks between South African gold-mining companies and workers are moving. “According to media reports, NUM had previously lowered its demands, though the strikes will continue for the time being. Meanwhile, two smaller gold mining producers have agreed with the union on pay rises of as much as 8%,” they say.

By Debbie Carlson of Kitco News; dcarlson@kitco.com

 

 

 

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