(Kitco News) - Gold prices are a bit firmer in early U.S. trading Thursday, supported in part by a weaker U.S. dollar index on this day. Silver prices are trading modestly lower. Traders and investors are awaiting a key U.S. economic report out today. December gold was last up $4.90 at $3,388.20. September silver prices were down $0.189 at $37.88.
On deck today is the important U.S. retail sales report for July, seen coming in up 0.5%, month-on-month, compared to a rise of 0.6% in the June sales report.
A hotter-than-expected U.S. producer price index report for July, released Thursday morning, has only slightly trimmed marketplace expectations for a Federal Reserve interest rate cut in September. The core PPI (excluding food and energy) rose 3.7%, year on year, well above market expectations. While the hot PPI data did not roil the markets Thursday and a Fed rate cut in September is still widely expected, the PPI probably took off the table a 50 basis-point Fed rate cut in September that a minority of the marketplace was thinking before the hot PPI data.
Asian and European stock markets were mixed overnight. U.S. stock indexes are set to open mixed when the New York day session begins, on pauses and mild profit taking after this week hitting record highs.
In overnight news, China’s economy broadly slowed in July, with factory activity, investment and retail sales disappointing, according to data released by the China’s National Bureau of Statistics on Friday. Production at Chinese factories and mines rose at the slowest pace since last November and increased at a less-than-expected 5.7% last month from a year earlier, compared with June’s gain of 6.8%. Retail sales grew 3.7%, year-on-year, in July, the slowest this year and down from 4.8% growth seen in June. China’s growth in fixed-asset investment in the first seven months of this year decelerated to 1.6% as a contraction in the real estate sector continued. The urban unemployment rate climbed more than expected in July, to 5.2%. The offshore Chinese yuan currency was steady after the slew of downbeat data. The Hang Seng China Enterprises Index fell as much as 1.5% Friday, while the onshore CSI 300 Index ended the morning session 0.5% higher.
Presidents Donald Trump and Vladimir Putin will measure success at their summit in Alaska today very differently, with Trump seeking a ceasefire in Ukraine and Putin seeing the meeting as a win without making concessions, according to a Bloomberg opinion story. “The summit is a repudiation of former President Joe Biden's approach of ‘nothing about Ukraine without Ukraine,’ and Trump believes he is central to ending the conflict, not Ukraine,” said the report. Richard Haass, a former senior U.S. State Department official, said "Russia wants to continue to pursue its objectives, which are to dramatically weaken Ukraine and essentially undermine its independence and sovereignty," and sees negotiations as a means to that end. Those are the contrasting stakes as both leaders head to Anchorage for their first summit since 2018 in Helsinki.
The key outside markets today see the U.S. dollar index lower, with crude oil prices up down and trading around $63.50 a barrel. The yield on the benchmark 10-year U.S. Treasury note is presently 4.27%.
Technically, December gold futures bulls have the firm overall near-term technical advantage. Bulls’ next upside price objective is to produce a close above solid resistance at $3,500.00. Bears' next near-term downside price objective is pushing futures prices below solid technical support at the July low of $3,319.20. First resistance is seen at the Thursday’s high of $3,423.80 and then at $3,450.00. First support is seen at $3,375.00 and then at $3,350.00. Wyckoff's Market Rating: 7.0.
September silver futures bulls have the firm overall near-term technical advantage. Silver bulls' next upside price objective is closing prices above solid technical resistance at the July high of $39.91. The next downside price objective for the bears is closing prices below solid support at the July low of $36.28. First resistance is seen at last week’s high of $38.875 and then at $39.00. Next support is seen at this week’s low of $37.515 and then at $37.00. Wyckoff's Market Rating: 7.0.
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