Gold, silver and stock markets were in a positive mind-set early Tuesday, shrugging off eurozone debt concerns, as well as France and Austria losing their AAA credit ratings from Standard & Poor’s. Investors and traders were focused on positive reports on German and northeast regional U.S. manufacturing, a healthy auction of French treasury bills and China reporting slightly higher-than-expected Q4 GDP.
Spot gold was trading 1% higher Tuesday morning, with a bid price of $1,659.20 per ounce and an ask price of $1,660.20. Spot gold traded as high as $1,665.90 and as low as $1,655.20. The London afternoon reference price fix came in at $1,656, $21.50 per ounce higher than last Friday’s reference price, according to Kitco market data.
Newmont Mining (NYSE:NEM) shares were down more than 3% following management’s latest guidance on 2012 production of gold and copper.
Spot silver was up over 1.55%, bid at $30.44 per ounce with an ask price of $30.54. The morning high as of time of writing was $30.69 and the low was $30.07. Friday’s reference price was set at $30.41 in the London a.m., 77 cents per ounce higher than last Friday’s price fix.
Market participants were prone to downplay S&P’s latest credit rating downgrades and negative watch outlooks. Boosting optimism was a smooth auction of French T-bills and a strong KZW report on economic sentiment, which jumped 32.2 points to -21.6 in January, its highest level since July 2011, according to a Wall Street Journal report. Also, although China reported that year-to-year Q4 GDP growth fell to its lowest level in more than two years, the 8.9% print was better than expected.
The load weighi! ng on ma rkets was lifted further with the release of the New York Federal Reserve’s January Empire State Manufacturing Survey, which indicated that manufacturing activity expanded in the state. The general business conditions index rose five points to 13.5 on a monthly basis, while employment indices were positive and higher.
Gold bullion prices rose to a five-week high in London morning trading Tuesday, and silver bullion rose to last week’s two-month high above $30.50, BullionVault reported in its London Gold Market Report.
“Gold price action is becoming increasingly indifferent to physical trade and far more susceptible to broader market headwinds,” says a note from Japanese trading house Mitsui’s London office.
Gold and silver trusts were showing strong gains on U.S. exchanges.
- The SPDR Gold Trust (NYSE:GLD) was showing gains of around 1.4%.
- The iShares Gold Trust (NYSE:IAU) also was up nearly 1.4%.
- The iShares Silver Trust (NYSE:SLV) was up more than 2.4%.
The junior gold and silver mining ETFs also were moving higher, though the Market Vectors Gold Miners ETF (NYSE:GDX) was showing losses.
- The Market Vectors Gold Miners ETF was down about 0.6%.
- The Market Vectors Junior Gold Miners ETF (NYSE:GDXJ) was up around 1.6%.
- The Global X Silver Miners ETF (NYSE:SIL) was up over 2%.
Gains in gold mining shares were muted, and shares of Newmont Mining were down sharply based on its latest fiscal 2012 guidance on gold and copper production.
- Agnico-Eagle Mines (NYSE:AEM) was showing losses of some 1.1%.
- Barrick Gold (NYSE:ABX) was down around 0.15%.
- Eldorado Gold (NYSE:EGO) was up 1.5%.
- Goldcorp (NYSE:GG) was up more than 0.6%.
- Newmont Mining was down more than 3%.
- Yamana Gold (NYSE:AUY) was trading flatly.
Silver mining shares were up Tuesday.
- Coeur d’Alene Mines (NYSE:CDE) was moving higher, up some 1.35%.
- Hecla Mining (NYSE:HL) was up around 2.35%.
- Pan American Silver (NASDAQ:PAAS) was up around 2.5%.
- Silver Wheaton (NYSE:SLW) was showing gains of 1.5%.
- Silver Standard Resources (NASDAQ:SSRI) was up 1.35%.
As of this writing, Andrew Burger did not hold a position in any of the aforementioned securities. Adrian Ash of BullionVault contributed to this report.
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