DAILY REPORT : Thursday 21 June 2018

MACRO: The U.S. current account deficit widened by USD $8 billion to USD $124.1 billion during Q1 (est: $129 billion). The print was largely driven by an increase in imports and higher oil prices. Existing home sales in the U.S. contracted during May, sliding -0.4% MoM to 5.43 million (exp: +1.1%). The print was the second consecutive decline following a downwardly revised -2.7% fall in April. The decline was largely driven by a -0.6% fall in single family homes, while regionally the Midwest sunk -2.3% to lead three of four regions lower. Equities in the U.S. ended mixed on Wednesday as investors considered the implications of fresh trade war headlines, with the U.S. ambassador to Germany meeting with leading automotive players to discuss ending/reducing car tariffs. The DJIA declined -0.17% to 24,657.80 points to mark the seventh consecutive session decline for the bourse, the longest such streak since March 2017. Gains to real estate stocks (+1.10%) helped buoy the S&P 500 to a +0.17% gain at 2,767.32, while the Nasdaq Composite (+0.72%) printed a fresh record close of 7,781.515 points as biotech stocks turned higher. The greenback saw mixed price action on Wednesday, however managed to book a modest gain (DXY +0.1%) on the session. The buck gained ground against the yen to consolidate above 110.00, while the euro softened marginally. European equities bounced back from recent weakness on Wednesday, seeing the Stoxx Europe 600 +0.28% higher at 384.29 points, while the German Dax tacked on +0.14% to 12,695.16 points. In the U.K. the FTSE 100 added +0.31% to 7,627.40 points, supported by gains to tobacco giants British American Tobacco (+2.38%) and Imperial Brands (+3.2%) after both were given buy ratings by Liberium.

PRECIOUS: Gold held a narrow range on Wednesday, however skewed to the down-side too see the metal decline underneath USD $1,270. Modest Chinese interest underpinned the yellow metal during Asian hours as Shanghai continued to see the metal at a premium of USD $6. The bid tone saw bullion push briefly above USD $1,275, however layered spec offers and producer selling restricted any further top-side gains. Gold softened modestly into the European open to test toward USD $1,270, while dollar strength in New York saw the metal underneath the figure to print a USD $1,268.50 low. Silver extended recent weakness to touch a USD $16.26 session low on Wednesday, while platinum booked a positive session after finding interest in New York.

Gold extended recent weakness during Asian trade on Thursday, weighed down by a stronger greenback to test toward at USD $1,260. The metal held a narrow range into the Chinese open, however sellers soon wrestled control to push gold underneath the USD $1,267 support. Interest around USD $1,265 kept bullion buoyant during the Chinese lunch break, however it wasn't long before the metal made a further leg lower, extending to a USD $1,262.20 low as the dollar continued to run higher. We continue to see ETF outflows, albeit only modest daily volumes, with risks to the down-side extending should funds increase the pace of unwinding. Resistance sits toward USD $1,275, while support sits around USD $1,250 and below this the Dec 2017 low of USD $1,236 will become vulnerable. Data releases today includes the BOE rates decision, U.S. initial jobless claims, the Philadelphia Fed business outlook, U.S. FHFA house prices and the U.S. leading index.

 

Although the information in this report has been obtained from and is based upon sources 1StopGold believes to be reliable, we do not guarantee its accuracy and it may be incomplete or condensed. All opinions and estimates constitute 1StopGold' judgment as of the date of this report and are subject to change without notice. This report is for informational purposes only and is not intended as an offer or solicitation for the purchase or sale of an investment. This report does not consider or take into account the investment objectives or financial situation of a particular party.

DAILY REPORT : Friday 15 Jun 2018

MARKETS/MACRO: Despite the ECB becoming more hawkish on policy, markets interpreted the statement as dovish, with the EUR plummeting vs. all the G10 (EURUSD low 1.1564 after trading briefly at 1.1850 following the initial release). Stocks across Europe surged by the most in 2 months in line with the crumbling Euro. The FTSE Euro First 300 Index rallied 18.97 points (+1.25%) to 1,536.42 and the Euro Stoxx 600 leapt +4.79 points (+1.23%) to 393.04. Regionally, performance was strong across the board with the DAX up +1.68%, CAC40 +1.39% and FTSE100 +0.81%. U.S. stocks closed higher on gains by big technology and media companies, outweighing laggard financial and industrial shares. A flurry of stronger-than-expected economic data also lent support to stocks, while investors were mostly supportive about the European Central Bank detailing a timeline for its bond-buying program. The Dow Jones Industrial Average fell -25.89 points (-0.10%) to 25,175.31, the S&P500 crept up +6.86 points (+0.25%) to 2,782.49 and the NASDAQ rallied +65.343 points (+0.85%) to 7,761.042. Base metals were lower following the weaker-than-expected China industrial production and fixed asset investment figures out yesterday. Sentiment was in no way assisted by the strength in the dollar either with Copper (-1.10%) and Nickel (-2.18%) bearing the brunt of the sell-off. U.S treasury yields were lower on the day, 10y dipping -3.1 bps to 2.935% and 2y off -0.4 bps to 2.564%.

The European Central Bank will shut its hallmark bond purchase scheme by the close of the year, it said on Thursday, taking its biggest step yet toward dismantling crisis-era stimulus a decade after the start of the Euro zone's economic downturn. Yet in a balanced announcement reflecting the uncertainties hanging over the economy, it signalled that any interest rate hike is still distant, raising the prospect that ECB chief Mario Draghi might leave office in October 2019 without having raised rates in his eight year term. The timid move to roll back stimulus contrasted with the U.S. Federal Reserve's rate hike a day earlier, which signalled a break from policies used to battle the 2007-2009 financial crisis and a return to normalised central banking. The ECB will halve its bond buys to 15 billion EUR a month from October then shut the program at the end of the year. It also sees interest rates steady "at least through the summer of 2019" - a vague definition that gives policy-makers a wide window and the flexibility to push back any move.

The Trump administration is preparing to release a refined list of Chinese products to be hit with tariffs that hones in on technologies where China wants to establish itself as a leader, according to five people familiar with the matter. The U.S. is scheduled on Friday to release an updated list of Chinese tariff targets - which according to some sources could effect as much as $50 billion worth of Chinese imports. The White House has said the duties will be implemented “shortly” after the release of Friday’s list, though no date has been set. The tariffs could be applied in stages, according to two of the people briefed on the administration’s plans. Duties will take effect on some products within weeks. Tariffs on any products added to the U.S. Trade Representative’s list would be subject to a period of public feedback.

PRECIOUS: An interesting session for gold overnight, the yellow metal finally breaching topside resistance at $1305, although tapered off as the EURUSD was whacked some 300 points from the highs. Gold opened around $1300 yesterday in Asia and ever so slowly made it's way lower throughout the Asia AM session - hitting the intra day low of $1297.90. As the European day commenced gold started to catch a bid with investors suspecting that the ECB would be announcing a timeline to ending QE in a matter of hours. EURUSD pushed higher and the gold followed, nudging against its resistance at $1305 for about an hour pre-ECB. Silver too, showed strength late in the Asia day, with Chinese bank selling dissipating in the afternoon. We managed to punch through the previous days highs, and settle between $17.10-15 - despite base metals taking a hit. Things got a little messy when the ECB announcement dropped. On the one hand the CB announced the path to abolish QE by the end of 2018, yet on the other, it mentioned that rates will likely stay low until at least the summer of 2019. EURUSD intially spiked to 1.1850 on the news, although aggressive selling then entered the market and it continued for the rest of the session, leveraged and systematic accounts in particular hitting offers in droves and sending the pair some 300 pips lower by session close. Gold travelled a similar trajectory, initially rallying to the high ($1309.55), although coming under the pressure as the EUR buckled and USD in general rallied. We closed out the NY session at the top end of the recent range ($1302).

The gold opened this morning and there was some light profit taking seen very slowly marching the market a dollar or so lower. Volume had noticeably picked up from what we have seen over previous sessions although price action remained tight throughout the morning ($1300.50-1303.00). The whole complex tapered off into the China open this morning, although there was decent buying seen across the board today from Chinese investors, likely the result of a firmer USDCNY for onshore traders. Premium was again fairly contained, still trading around $4.50-6.00 over the loco London price. Silver retained the ground made last night holding fairly close to $17.20 throughout , while the PGM's have also remained fairly stable. The main data release today was that of the BoJ, which failed to really move the markets. The central bank left rates on hold as expected, although their tone had shifted somewhat. Board member Kataoka was quoted as saying that the BoJ "should clarify it will ease further if domestic factors delay achievement of price target", so there does seem to be a little dissent among the ranks. As mentioned, the markets failed to react in any meaningful way, the USDJPY about 20 pips higher to 110.80 immediately after the release. Ahead today look out for the new Chinese tariff announcement from the White House, which likely has the greatest likelihood of moving markets. The Wall Street Journal has mentioned today that insiders say Trump has now signed off on these tariffs and we are only just awaiting the details. We also have Euro Zone CPI, U.S Empire manufacturing, Industrial production and University of Michigan sentiment.

 

Although the information in this report has been obtained from and is based upon sources 1StopGold believes to be reliable, we do not guarantee its accuracy and it may be incomplete or condensed. All opinions and estimates constitute 1StopGold' judgment as of the date of this report and are subject to change without notice. This report is for informational purposes only and is not intended as an offer or solicitation for the purchase or sale of an investment. This report does not consider or take into account the investment objectives or financial situation of a particular party.

DAILY REPORT : Monday 11 Jun 2018

MACRO: Wholesale inventories in the U.S. printed modestly higher than initially estimated during April, increasing +0.1% MoM (exp: flat) from a flat April read previously and a +0.2% increase in March. Wholesale inventories (ex-autos), the figure that is use in the calculation of GDP was also up +0.1%. Equities in the U.S. tracked higher on Friday as participants put aside concerns over the G7 summit and the upcoming meeting between President Trump and North Korean leader Kim Jong-un. The DJIA added +0.30% to 25,316.53 points, marking the highest close since March in addition to its biggest weekly gain since March in adding 2.8%. Strength to consumer staples (+1.3%) helped see the S&P 500 +0.31% higher at 2,779.03 points amid a number of positive earnings reports, taking the bourse +1.6% higher on the week, while the Nasdaq Composite tacked on +1.4% to 7,645.51 points, closing +1.2% higher on the week. The greenback saw mixed pricing on Friday as the G7 summit in Canada got underway amid simmering trade tensions. The DXY index ended the session +0.2% higher after paring European gains during the new York hours, notably losing ground against the yen. The latest CFTC data showed speculators sold $0.2 billion of USD contracts to put an end to 6-weeks of buying and increased short positioning to $5.7 billion. Treasury yields in the U.S. inched higher on Friday as bonds were sold late in trade, seeing the 10-year to 2.946%. Markets in Europe closed in the red on Friday on the back of fresh concerns out of Italy and uncertainty into the G7 meeting. The Stoxx Europe 600 pulled back -0.21% to 385.12 points, while the German Dax declined -0.35% to 21,355.98 points and the Italian FTSE MIB index sunk -1.89%. In the U.K. the FTSE 100 was sold off on the back of contagion out of Europe, sliding -0.30% to 7,681.07 points.

PRECIOUS: Silver outperformed during Asian hours today, ripping higher on a stop loss run though the 200 DMA to touch a USD $16.91/93 session high. The grey metal has traded bid in European/U.S. hours in recent sessions, however has continued to struggle in Asian hours amid selling pressure out of China. The metal now turns focus to extending upon these gains and squeezing shorts for a move through USD $17 and consolidation above the figure. As we have become accustomed to seeing over recent sessions, bullion once again made headway above USD $1,300 only to be met with heavy supply above the figure. With no real catalyst for the break above USD $1,300, it looked likely that the yellow metal piggybacked the move higher in silver before easing back underneath the figure leading into European trade. Expect the precious complex to see volatile trade this week with a number of events on the calendar including ongoing headlines following the G7 summit, the meeting between President Trump and North Korean leader Kim Jong-un, the June FOMC meeting and the ECB meeting with focus on comments regarding the future of QE.

 

Although the information in this report has been obtained from and is based upon sources 1StopGold believes to be reliable, we do not guarantee its accuracy and it may be incomplete or condensed. All opinions and estimates constitute 1StopGold' judgment as of the date of this report and are subject to change without notice. This report is for informational purposes only and is not intended as an offer or solicitation for the purchase or sale of an investment. This report does not consider or take into account the investment objectives or financial situation of a particular party.

DAILY REPORT : Wednesday 20 June 2018

MARKETS/MACRO: Following the intensification of US-China tit-for-tat trade rhetoric, the risk-off tone continued through the European session. Lower equities, safe-haven demand for fixed income and USD strength dominated proceedings. The Dow Jones Industrial Average relinquished -287.26 points, or -1.15%, to 24,700.21. The steep decline marked a sixth straight drop for the blue-chip index, representing the longest string of down days in over a year and erasing all of 2018’s gains thus far (-0.10% YTD). The S&P500 sold off -11.18 points, or -0.40%, to 2,762.57 and The NASDAQ Composite slumped -21.44 points, or -0.28%, to 7,725.585. The best performing sector on the day were Telco's (+1.4%), while the worst performing sector was Industrials (-2.1%). Trade-war talk affected European bourses also, investors continuing to liquidate across the board. The EuroFirst 300 Index sank -10.80 points, or -0.72% to 1,498.06 and the EuroStoxx 600 retraced -2.70 points, or -0.7% to 383.21. Regionally the DAX cratered -1.22% FTSE100 dipped -0.36% and CAC40 slid -1.10%. Elsewhere, the escalating trade war came as OPEC headed toward a fractious meeting in Vienna, sending crude oil prices lower (WTI -$0.75, or -1.14% to $65.10, Brent -$0.33, or -0.44% to $75.01). Saudi Arabia and Russia continued to push for a relaxation in production constraints, going against many other members wishes. Iran rejected a potential compromise, saying it won’t support even a small increase in oil production. In fact, the Iranian oil minister said that he doesn’t believe this meeting can reach an agreement. This puts Saudi Arabia in a tough position, as unanimity is needed for any accord to be reached. In FX, the dollar strengthened against a host of currencies following Trump's retaliatory barbs at China. Sterling in particular was pressured ahead of tomorrow’s House of Commons vote on the Brexit bill, with the pro-European and harder Brexit factions still deeply divided. In fixed income U.S 10y yield's decreased -2.02bps to 2.897% and the 2y yield fell -0.4bps to 2.545%.

President Donald Trump late Monday proposed identifying $200 billion in Chinese imports for additional tariffs of 10% - with a further $200 billion after that if Beijing decided to retaliate. While the $50 billion in tariffs already announced on Friday focused on industrial goods, this broader-reaching move would push up prices for imports such as toys, tools, t-shirts and a lot more for U.S. shoppers. China were again quick to respond with retaliation measures. “If the U.S loses its senses and publishes such a list, China will have to take comprehensive quantitative and qualitative measures”, according to a statement from China's Ministry of Commerce. It labelled the move “extreme pressure and blackmail", in the statement. Trump's trade adviser Peter Navarro said yesterday that tariffs against China will be "ultimately bullish" for American businesses, as the administration tries to bring "structural change" to the U.S-China trading relationship. Navarro mentioned the U.S and China are having "a trade dispute, nothing more, nothing less". He said Trump is willing to talk to China and other nations about trade.

On the data front, U.S May housing starts rose +5.0% MoM to 1.35m starts (+1.9% and 1.311m expected), marking a new recovery high and brings housing starts closer to their ultra-long run average of 1.43m. Construction is growing at the fastest pace in more than a decade, however, building permits fell -4.6% MoM (-1.0 expected), suggesting the longer-term outlook for builds may not be as firm.

PRECIOUS: Gold was not immune from the risk-off sentiment overnight despite it's safe-haven qualities, the metal instead trading in-line a firmer dollar and dipping to fresh yearly lows just short of $1270. Gold opened in Asia and interestingly remained firm throughout much of the morning, with China/HK and Singapore back from holiday and looking to take advantage of the lower prices. USD/CNY fixed lower on the day, which pushed up the SGE premium in early trade to around $6.50-7.50 over the loco London price and drew out some demand. USDJPY was also higher following some of the Trump trade war comments which pushed spot gold up to the highs of the day - toward $1284 - where there was some good supply at $1285 (cash). When China reopened for the PM session, the SHCOMP was hit hard in the wake of the trade war headlines (-4.8%), which dragged the USDCNY higher and deflated the SGE premium back towards $4-5, prompting some liquidation. Base metals and the PGM's were hit hardest, but gold and silver were lower into the London open. Industrial metals continued to sell off into the European morning and the precious continued to sink. When NY opened the selling continued and gold quickly dropped down to the lows of the day ($1271.05) before finally recovering and holding between $1273-1276 into the session close. The market attention certainly seems to be on the U.S and China at present and what comes out of these tariff for tariff blows. One would think gold should perhaps be higher given the uncertainty, instead it is trading like any other commodity at the moment and at the mercy of swings in the USD. The stronger USDCNY will continue to quell Chinese demand at these lower levels and we feel that specs could be a little reluctant to go long here given the technical set up. It will be interesting to look at ETF activity over the next few weeks given holdings still remain fairly robust, despite trading near year lows.

Not a great deal of action in Asia today with the yellow metal happily consolidating within a $3 range. We opened at $1275 and traded sideways up until TOCOM opened, where some light selling in thin conditions was seen nudging spot gold down to $1273.50. As China opened for business there was some small buying seen which pushed the yellow metal up to intra-day highs, although with the SGE premium still range-bound ($5-6) turnover was limited. In other markets, Asian equities are higher Nikkei currently up +1.25%, Hang Seng +1.1%, Shanghai Composite +0.50% and ASX200 +1.15%, while WTI crude has rebounded +$0.35 (+0.5%) to $65.40. The USD has generally pushed higher against the majors, with exception of the AUD which is up +20 pips at 0.7400. On the data calendar today look out for German PPI and U.S mortgage applications, current account balance and existing home sales.

 

Although the information in this report has been obtained from and is based upon sources 1StopGold believes to be reliable, we do not guarantee its accuracy and it may be incomplete or condensed. All opinions and estimates constitute 1StopGold' judgment as of the date of this report and are subject to change without notice. This report is for informational purposes only and is not intended as an offer or solicitation for the purchase or sale of an investment. This report does not consider or take into account the investment objectives or financial situation of a particular party.

DAILY REPORT : Thursday 14 Jun 2018

MACRO: As widely expected the FOMC voted to raise interest rates by 25bps during the June meeting to a range between 1.75 - 2%. Members surprised to the hawkish side and have forecasted a further two rate increases this year (total of four), to follow only three forecasted at the March meeting. Most expect three increases in 2019 and one in 2020 to see the benchmark rate at between 3.25 - 3.50% by the end of 2020. Economic forecasts were also interpreted as more hawkish with unemployment rate projections lowered, while growth and inflation were revised upwards for 2018. The U.S. PPI spiked +0.5% MoM during May (exp: +0.3%), underpinned by a surge in gasoline prices. On an annualised basis PPI increased +3.1% YoY (exp: +2.8%) to mark the biggest annual gain in over six years. Core PPI (ex food, energy and trade) meanwhile added +0.1% MoM to see the annualised figure to +2.6% YoY. Equity markets in the U.S. eased modestly on Wednesday following the FOMC announcement, while participants also considered President Trump's comments regarding aggressive trade action toward China. The DJIA declined -0.47% to 25,201.20 points, heavy trade to telecoms (-4.49%) as a result of falls to AT&T and Verizon saw the S&P 500 -0.4% lower to 2,775.63 points, while the Nasdaq Composite eased -0.11% to 7,695.699 points after hitting an intra-day record of 7,748.958 points. Currency majors ended higher against the greenback on Wednesday, however had to endure whippy price action around the FOMC announcement. The DXY index ended the session -0.3% lower as the euro headed back toward 1.18 and the buck eased toward 110.00 against the yen. Treasury yields pushed higher on the back of the FOMC meeting, seeing the 10-year spike briefly above 3% before settling around 0.5bps higher at 2.966%, while the two-year added around 3bps to 2.578% after spiking to a 3-week high. The pricing saw the yield curve flatten to the narrowest level since 2007.

PRECIOUS: A generally positive session for gold in Asia on Thursday, however still held within the recent range. The post-FOMC weakness to the greenback extended further in early Asian trade, however bullion struggled to find its footing after the New York close above USD $1,300 and drifted back underneath the figure into the Chinese open. A Shanghai premium of around USD $6 did little spark interest in the metal as participants on Comex looked to take profits around USD $1,300 in respect of the recent range. Finally the greenback weakness began to awaken some interest in the metal during afternoon pricing, pushing gold back above USD $1,300, however the move looked to be driven by a squeeze higher to silver as shorts came under pressure back above USD $17 (likely Chinese driven). Concerns over an escalation in the trade war between the U.S. and China look to have overshadowed the FOMC decision, with participants on the bid into the European open to see bullion through Wednesday's high print. Gold continues to see heavy supply through USD $1,305 - $1,310 and will require a major shock either from ECB or the escalation of trade tensions to move through the resistance band. Likewise for silver we see a broad band of resistance through USD $17.20 -$17.40, while platinum has managed to regain the USD $900 pivot point although hasn't been able to extend far from the figure. All eyes tonight on the ECB. while we also see German CPI, U.K. retail sales, U.S. retail sales, U.S. import price index, U.S. initial jobless claims and U.S. Bloomberg consumer confidence.

 

Although the information in this report has been obtained from and is based upon sources 1StopGold believes to be reliable, we do not guarantee its accuracy and it may be incomplete or condensed. All opinions and estimates constitute 1StopGold' judgment as of the date of this report and are subject to change without notice. This report is for informational purposes only and is not intended as an offer or solicitation for the purchase or sale of an investment. This report does not consider or take into account the investment objectives or financial situation of a particular party.

DAILY REPORT : Friday 8 Jun 2018

MACRO: Initial jobless claims in the U.S. eased 1,000 to 222,000 during the week ended June 2 (exp: 220,000). The print saw the four-week moving average to 225,500 from 222,750 the week prior, while continuing claims increased by 21,000 to 1.741 million (exp: 1.735 million) the week ended May 26. Consumer credit in the U.S. increased less than expected during April, reflecting a slow-down in non-revolving credit. Credit increased by $9.262 billion (exp: $14.0 billion) to follow a $12.278 billion increase the month prior and an average monthly increase of $13.5 billion during the first three-months of the year. Equities in the U.S. ended mixed on Thursday as heavy trade to tech stocks knocked the wind out of the Nasdaq Composite's recent record run. The DJIA was able to hold onto a +0.38% gain to end at 25,241.41 points, however weakness across technology stocks (-1.09%) saw the S&P 500 -0.07% lower to 2,770.37 points, while the tech-laden Nasdaq Composite sunk -0.70% to 7,635.07 points. The greenback declined for a third consecutive session on Thursday as the euro continued to strengthen on expectations the ECB will outline plans to end their QE program next week. The DXY index pulled back -0.6% to the lowest level in around three-weeks. Treasury yields in the U.S. eased on Thursday to see the 10-year 5bps lower to 2.92% and the two-year off 3bps to 2.487%. European equities struggled against euro headwinds on Thursday, while a surprise decline to German factory orders hit sentiment. The Stoxx Europe 600 dipped -0.24% to 385.94 points, the German Dax declined -0.15%, while in the U.K. the FTSE 100 was sold down -0.10%. Oil futures posted gains on Thursday as market participants turned focus to potential supply losses out of Venezuela. WTI popped +1.25% to USD $65.90 per barrel, while the global benchmark Brent crude surged +2.3% to USD $77.35 per barrel.

PRECIOUS: Another session and another failed break above USD $1,300 for gold, once again capturing the figure in early new York trade only to be sold down shortly after. A muted Asian session gave way to a modest bid tone in Europe, with price action underpinned by a stronger euro to test toward USD $1,300. Heavy spec and producer selling reversed a early New York session break above the figure, as a session high of USD $1,303.05 was met with abundant offers. Afternoon flows in New York failed to garner the support required for a fresh test above USD $1,300 and the metal ended trade relatively flat on the session. ETF's once again reported outflows (140k ounces), a common occurrence recently when breaking above USD $1,300. Silver booked a third straight session gain on Thursday, surging to a USD $16.90 session high on a stop loss run through the 200 DMA (USD $16.77). Much like god, the metal succumbed to late session weakness to pare the majority of gains into the close and end around +0.22% higher.

Asian trade on Friday was once again a relatively muted affair, albeit for a sharp sweep lower just minutes before the Chinese afternoon session that saw the session low of USD $1,292.90 printed. Bullion spent the majority of the session held within a tight range around USD $1,296 - $1,297, however saw downwards pressure from a leg higher to the greenback in afternoon flows and remained under pressure into European trade. The metal still struggles to find a handle above USD $1,300 and will need to consolidate above the figure to entice further interest into the market. That being said underlying interest broadly sitting toward USD $1,290 - $1,295 continues to provide an underling level of interest. Silver has found interest underneath USD $16.70 and will target an extension through USD $16.77 for a further leg higher, while platinum continues to struggle to break clear of USD $900 and is facing top-side resistance around the 50 DMA at USD $913. Data releases today include German industrial production and U.S. wholesale inventories.

 

Although the information in this report has been obtained from and is based upon sources 1StopGold believes to be reliable, we do not guarantee its accuracy and it may be incomplete or condensed. All opinions and estimates constitute 1StopGold' judgment as of the date of this report and are subject to change without notice. This report is for informational purposes only and is not intended as an offer or solicitation for the purchase or sale of an investment. This report does not consider or take into account the investment objectives or financial situation of a particular party.

DAILY REPORT : Tuesday 19 Jun 2018

MACRO: Equities in the U.S. ended generally lower on Monday, with a lack of economic data for direction participants took their lead from trade tensions between the U.S. and China. The DJIA pulled back -0.41% or 103.01 points to 24,987.47 points, booking a fifth consecutive decline, however able to bounce off early session lows that saw the bourse down 264 points at one stage. Weakness to telecommunication stocks (-1.97%) outweighed gains to energy (+1.12%) to see the S&P 500 -0.21% down to 2,773.75 points, while the Nasdaq Composite reversed early session declines to inch +0.01% higher to 7,747.025 points. On the data front, the U.S. National Association of Home Builders housing market index eased to 68 during June (exp: 70) to follow 70 during May. Sales expectations for the next six months declined from 77 to 76. Currency majors clawed back ground against the greenback (DXY -0.13%) on Monday, with safe-haven currencies the Japanese yen and Swiss franc gaining ground on the back of 'trade war' fears, while the euro was able to recover from weakness in Asia to break back above 1.16. Oil futures turned higher on Monday to see WTI gain around +2% to USD $65.80 per barrel and Brent crude jumped +2.8% to USD $75.39 per barrel. Stock markets in Europe traded under pressure on Monday, with participants spooked by further 'trade war' concerns and a political stalemate in Germany over migrant issues. German Chancellor Angela Merkel's coalition government is coming under increasing strain over migrant issues and it was reported that she has been handed a two-week ultimatum by her coalition partners to secure a deal on migrants with the country's European neighbours. The news saw the German Dax heavily sold, collapsing -1.36% to 12,834.11 points, while the Stoxx Europe 600 ended trade -0.83% lower at 385.91 points. In the U.K. the FTSE 100 tracked European markets lower, giving back -0.03% to 7,631.33 points, however finding some respite from a softer pound.

PRECIOUS: Gold held around the USD $1,280 pivot point on Monday, seeing little interest from the on-going trade saga between the U.S. and China. Price action out of Asia was a generally muted affair with China and Hong Kong on leave, seeing offers toward USD $1,282 restrict any further top-side moves. European hours saw a mild bid on the back of a softer dollar (euro back above 1.16), however once again topping out around USD $1,282 and easing in New York. Silver remained drawn toward the USD $16.50 pivot point, testing below the figure in New York, however able to recover into the close, while the white metals pared an early New York bid to close generally unchanged and still well below their respective recent support levels.

Fresh tariff related news from President Trump today, announcing that he has directed the United States Trade Representative to identify USD $200 billion worth of Chinese goods for additional tariffs at a rate of 10 percent. The headlines gave gold a boost in Asia today, breaking back above USD $1,280 and moving through the New York high and recent resistance level around USD $1,282. We saw modest interest out of China at a USD $5 premium, however the metal failed to extend further as offers through USD $1,283 - $1,284 restricted top-side gains. We will be keeping an eye on trade war headlines that may give bullion a modest geopolitical boost, especially considering the most recent announcement, however we expect the dollar to remain bid even amid today's pricing (DXY -0.25% in Asia) to weigh upon price action over the near term. Resistance comes in around USD $1,283 - $1,285 as we have seen throughout Asia today, while support sits at USD $1,275 - $1,277.

 

Although the information in this report has been obtained from and is based upon sources 1StopGold believes to be reliable, we do not guarantee its accuracy and it may be incomplete or condensed. All opinions and estimates constitute 1StopGold' judgment as of the date of this report and are subject to change without notice. This report is for informational purposes only and is not intended as an offer or solicitation for the purchase or sale of an investment. This report does not consider or take into account the investment objectives or financial situation of a particular party.

DAILY REPORT : Wed 13 Jun 2018

MARKETS/MACRO: Markets failed to react in any meaningful way to the landmark meeting between U.S president Donald Trump and North Korean leader Kim Jong Un, instead shifting focus to 3 critical central bank meetings (FOMC/ECB and BoJ) kicking off today. U.S equity indices closed the day flat to higher, with the DJIA inching lower -1.58 points (-0.01%) to 25,320.73, the S&P500 up +4.85 points (0.17%) to 2,786.85 and the NASDAQ Composite advancing +43.869 points (+0.57%) to 7,703.794. European stocks finished slightly lower as the closely watched summit between Trump and Kim Jong Un provided little detail. The EuroFirst 300 crept -0.25 of a point lower (-0.02%) to 1,516.10 and the EuroStoxx 600 decreased -0.41 of a point (-0.11%) to 387.53. Regionally, the FTSE100 sank -0.43%, the DAX was flat and the CAC40 retreated -0.38%. Crude oil prices came under pressure after data showed OPEC production was on the rise (WTI -$0.08 to $66.02 and Brent -$0.97 to $75.49). OPEC’s monthly report said that an average of 33.34m b/d is required from the 14 member group in the second half of the year. However, output from Venezuela slumped to 1.39m b/d in May. Traders remain split on whether OPEC will increase output significantly at next week’s OPEC meeting, after a variety of members indicated the reluctance to change strategy. Prices also came under pressure after private data showed U.S inventories had increased by 833k barrels last week. The EIA report will be closely monitored tomorrow. Elsewhere the U.S 10y yield increased +0.92bps to 2.961% and the 2y yield spiked 1.85bps to 2.539%.

U.S. President Donald Trump and North Korean leader Kim Jong Un pledged to work toward complete denuclearisation of the Korean peninsula, while Washington committed to provide security guarantees for its old enemy. At the end of their historic summit in Singapore, Trump and Kim signed an agreement to work toward complete denuclearisation and a lasting "peace regime" on the Korean Peninsula. The document, which Trump deemed "very comprehensive," says the two sides commit to hold follow-up negotiations and to cooperate to develop bilateral relations. Asked about what the agreement meant for North Korea's denuclearisation, Trump said "we're starting that process very quickly — very, very quickly." Many experts expressed dismay at the agreement, however, saying it lacked a solid commitment by Pyongyang, while others said it was vague as to details. Critics have noted no clear timetable, no mutual definition of denuclearisation, no verification procedures and no specifics on which US military exercises would be suspended amongst other things.

On the data front overnight, U.S CPI rose a seasonally adjusted +0.2% in May from the prior month as expected, according to the U.S Labour Department. Prices rose +2.8% last month from the prior year, the strongest reading since February 2012, when inflation was +2.9% YoY. One driver of higher prices this year has been gasoline. The average cost for a gallon of regular gasoline was $2.90 in May, up from $2.48 in December, according to the EIA. The report showed energy prices climbed a seasonally adjusted +0.9% last month. Core CPI also rose +0.2% (+0.2% expected), signalling broader inflation. In the UK, the unemployment rate stood 4.2% in the three months to April of 2018, the same as in the previous period and the lowest since 1975. In Germany, poor ZEW survey results continued the recent poor run of data for the European powerhouse economy. ZEW Current Conditions figure dropped sharply to 80.6 versus 85.0 expected and 87.4 booked previously, missing market expectations by a big margin. The ZEW Indicator of Economic Sentiment for Germany dropped by 7.9 points from the previous month to -16.1 in June 2018, below market expectations of -14. It was the lowest reading since September 2012, due to the recent escalation in the trade dispute with the U.S as well as fears over the new Italian government pursuing a policy which potentially destabilises financial markets. On top of this, German industry reported worse than expected figures for exports, production and incoming orders for April. Also, the assessment of the current economic situation in the country decreased by -6.8 points to 80.6.

PRECIOUS: Another dull and sluggish session for gold, remaining range-bound ahead of the numerous important central bank meetings at the back end of this week. Gold opened yesterday on the days highs and slowly started to edge lower as fast money specs took short positions on their books in early trade and the USD inched higher. Market focus was specifically on the historical U.S/N. Korea summit which began well with the two leaders giving off positive body language from their opening introductions. The gold trickled lower over the course of the morning after which it happily traded a narrow range of $1297-99 throughout the morning SGE session. USD strength over the Asia day continued to weigh on the metals, as did the general positive vibe surrounding the summit - softening any safe haven buying that may otherwise have taken place. During London hours the EURUSD began to pick up steam moving back toward 1.18, although gold failed to follow, contently trading the earlier range. When NY traders kicked off their day there was a deluge of selling, taking us sharply off to the days lows at the bottom of the recent range pre-CPI. The CPI was another strong figure although it did miss estimates. As a result the yellow metal did a quick about face and marched back toward $1300. From there though we eased back toward $1295-96 where we wrapped things up for the day. ETF's continue to slowly give up holdings, figures according to Bloomberg dipping somewhere in the realm of 1 million oz of gold over the past 10 days - from 72 million to 71 million oz. Any significant acceleration on sales in this space could see a sharp downside flush-out through $1285-90 support. The main catalysts over the coming days for gold are undoubtedly the FOMC and ECB and particularly their effect on the USD and EUR respectively. Silver has held in relatively well over the past few sessions with decent support seen on dips toward $16.75. We feel however that there will need to be some important catalyst here to wipe out the deluge of Asian based sellers sitting between $16.90-17.10 and proceed higher.

Not a great deal to report today, Asian traders happy to sit on their hands ahead of tonight's FOMC meeting.The yellow metal opened at $1295.80 and traded cautiously sideways over the first few hours of trade. There was some very light liquidation seen from Asian names as the morning session wore on, although it was of such small size it had very little impact on price and was easily absorbed. Slight dollar strength persisted into lunch and the afternoon which kept a lid on things despite some modest Chinese buying throughout the morning and early second session. We expect markets to remain subdued into tonight's FOMC announcement and communication. In other markets equities in Asia are generally lower with the Shanghai Composite currently -0.75%, Hang Seng -0.6% and ASX200 -0.6%, while the Nikkei has bucked the trend and trading up +0.4%. WTI is flat on the day at $66.00, while Brent is a little softer down -$0.25 (-0.34%) currently at $75.62 and the Greenback is firmer against most majors with the exception of the EURUSD which is a touch higher at 1.1750. On the data front FOMC is front and centre, but also look out for UK CPI and PPI, Euro Zone IP and employment and U.S PPI.

 

Although the information in this report has been obtained from and is based upon sources 1StopGold believes to be reliable, we do not guarantee its accuracy and it may be incomplete or condensed. All opinions and estimates constitute 1StopGold' judgment as of the date of this report and are subject to change without notice. This report is for informational purposes only and is not intended as an offer or solicitation for the purchase or sale of an investment. This report does not consider or take into account the investment objectives or financial situation of a particular party.

DAILY REPORT : Thursday 7 Jun 2018

MARKETS/MACRO: Speeches from senior ECB officials dominated a day that was light for top-line data releases, leading to a sell-off in European bonds. Yields were higher across the euro area, with German 10-year yields up 10bp, French 10-year yields up 11bp and Italian yields up 14bp. The prospect of an end to QE also pushed up the Euro which traded to a high of 1.1796 during NY, and closed only slightly lower at 1.1780. U.S. stocks closed firmly higher yesterday, with the NASDAQ Composite closing at another record high and extending a recent winning streak to a fourth straight session. The Dow Jones Industrial Average rallied +346.41 points, or +1.40%, to 25,146.39, the S&P500 advanced +23.55 points, or +0.86%, to 2,772.35 and the NASDAQ Composite added +51.38 points, or +0.67%, to 7,689.243. The best performing sector on the day was Materials (+1.87%), while the worst performing sector was Utilities ( -2.13%). It was a choppy session for European equities, ultimately ending the day fairly flat as ECB policy makers continued to reiterate their focus on ending the central banks QE program. The EuroFirst 300 index inched lower -0.57 of a point, or -0.04% to 1,512.07 and EuroStoxx 600 was unchanged at 386.88. Regionally the FTSE100 rose +0.33%, DAX climbed +0.34% and CAC40 was a little softer down -0.06%. WTI Crude oil was softer on the day (-$0.51, or -0.78% to $65.01), led lower by WTI on inventory data. The EIA weekly report showed a surprise increase in stockpiles in the U.S. Investors had been looking for a drawdown of about 2m barrels last week, but the data showed a rise of 2m barrels. At the same time, gasoline stockpiles increased the most since December. This comes as the country heads into the peak driving season. The rise in stockpiles was also driven by a strong increase in imports, with Saudi Arabian crude almost doubling to 1.12mb/d last week. Domestic crude oil production in the US was also higher (+31kb/d to 10.8mb/d).

Hawkish comments by the European Central Bank pushed borrowing costs across the euro zone higher on Wednesday, with the impact felt deepest in Italy where markets continue to reel from the prospect of big spending policies from a new government. ECB chief economist Peter Praet said on Wednesday the central bank was increasingly confident that inflation is rising back to its target and will next week debate whether to gradually unwind bond purchases. Expectations that the ECB will wind down its bond-buying programme by year-end are plausible, the head of Germany's central bank added. The remarks, which come just a week ahead of a closely watched ECB meeting, caught markets off guard. The recent turmoil in Italy had led some investors to bet the ECB would adopt a somewhat more cautious tone. "The market is very sensitive to changes in the central bank outlook and with a change in the ECB's stance looming, the sensitivity is increasing", mentioned one analyst.

On the data front, the U.S trade deficit shrank to $46.2 billion in April, down from $47.2 billion a month earlier. This is the smallest deficit in seven months and was narrower than market expectations of a $49 billion deficit. Exports increased +0.3% MoM to a record high, while imports fell -0.2% MoM. Elsewhere, Mortgage applications climbed in numbers, increasing +4.1% from last week, according to data from the Mortgage Bankers Association’s Weekly Mortgage Applications Survey for the week ending June 1, 2018.

PRECIOUS: It was another inside day for gold on Wednesday, rallying through $1300 to test resistance around $1302, although ultimately closing on a $12 handle. We opened in Asia around $1297 and traded fairly flat throughout the Asia morning yesterday around $1297-98. Flows were light, with some sporadic producer offering in modest clips and light Chinese buying despite a softer USDCNY. We tried up towards $1300 during the Asia PM session, although it was short lived with early European traders happy to sell into the strength. It was around this time that base metals began to tick higher, which helped to boost silver and palladium, pushing the former through $16.50 and latter towards $1000. Further jaw-boning from ECB officials Praet and Weidmann regarding QE saw the EUR surge during early NY trade. Gold gained some momentum from this also climbing through $1300 yet was unable to break through the downtrend line on the daily chart dating back to mid April ($1301.30). The yellow metal then did a quick about face and moved back toward the mid $1290's where we ultimately closed. Silver managed to hang on to its gains unlike gold, touching a high of $16.73 and closing at $16.67. Palladium was very strong throughout the NY session, initially aggressively selling off to the day lows ($995), before sharply turning around and tripping stops through $1000 to a high of $1021.80. Pd held fairly close to the highs for the remaining 4 hours of trade sitting just beneath $1020 - a solid performance for the day (+2.45%).

Not a great deal to report for today's Asian session with gold so far being contained to a $2 range. Some very light two-way trade was seen in GCQ8 in the hours leading up to SGE open, gold confined to $1296.50-1298 (cash) and edging lower leading into Shanghai's open. An initial push lower was quickly countered by some SE Asian physical demand and kept the metal buoyant above $1295.50, although the flows remained exceptionally light. SGE premium was again sitting fairly flat around $6 the loco London price, where it has been for a few days in Asia now. Over the China lunch break the metals all traded sideways, gold sitting at $1297 at time of writing. In other markets, equities have pushed higher in line with the impressive overnight gains in the States, the Nikkei at time of writing is up +0.81%, Hang Seng +0.55%, Shanghai Composite +0.1% and ASX200 +0.7%. WTI Crude and Brent are flat at $65.01 and $75.70 respectively, while the USD is mixed against the G10, AUDUSD is 20 pips lower at 0.7650, while the EURUSD has remained well bid touching 1.1800 but currently trading at 1.1785. On the data calendar today look out for U.S jobless claims, UK housing prices, Eurozone Q1 GDP and German retail sales.

 

Although the information in this report has been obtained from and is based upon sources 1StopGold believes to be reliable, we do not guarantee its accuracy and it may be incomplete or condensed. All opinions and estimates constitute 1StopGold' judgment as of the date of this report and are subject to change without notice. This report is for informational purposes only and is not intended as an offer or solicitation for the purchase or sale of an investment. This report does not consider or take into account the investment objectives or financial situation of a particular party.

 

 

DAILY REPORT : Mon 18 Jun 2018

MACRO: A further escalation in the trade war between the U.S and China over the weekend with Beijing moving to impose an additional 25 per cent tariff on 659 U.S. goods. The move comes following President Trump's announcement on Friday that the U.S. would impose fresh tariffs on 1102 Chinese product lines to the tune of USD $50 billion per year. The trade tensions weighed upon equities in the U.S. as the major bourse's ended modestly lower on Friday. The DJIA eased -0.34% to 25,090.48 points, however was able to recover from early session weakness that saw the bourse off as much as -1.1%. The S&P 500 saw weakness across energy stocks (-2.11%) to slip -0.10% to 2,779.66 points, while the Nasdaq Composite pulled back -0.19% to 7,746.378 points. Over the week the DJIA fell -0.9%, the S&P inched +0.01% higher and the Nasdaq outperformed +1.3%. The Empire state manufacturing index increased 4.9 points in June to 25.0 (exp: 18.8), marking the highest read since October 2017 as new orders, shipments and employment all recorded solid gains. Industrial production in the U.S. fell into negative territory for the first time in 4-months, sliding -0.1% MoM (exp: +0.2%) to follow an upwardly revised +0.9% previously. The greenback held a narrow range on Friday following the recent central bank related strength, seeing the DXY ease -0.1% as participants considered the implications of fresh tariffs. European equities were sold-off on Friday as the U.S. and China resumed their 'trade war'. The Stoxx Europe 600 slumped -0.99% to 389.13 points, the German Dax declined -0.74% to 13,010.55 points and in the U.K. the FTSE 100 tanked -1.7% on the back of Chinese related weakness across mining stocks.

PRECIOUS: An outside session for gold on Friday as sellers swept the metal to a fresh 2018 low of USD $1,276.30. Price action was generally restricted to New York hours as the yellow metal traded either side of USD $1,300, finding layered bids underneath the figure to soak up producer selling. It was generally one-way traffic in New York however as participants triggered a number of stop loss orders through USD $1,290 and again at the May low around USD $1,282. The weakness looked to be a delayed reaction to greenback's ECB related gains on Thursday, squeezing out long positioning and finding little in the way of support on the back of 'trade war' headlines. Silver outpaced gold on Friday to tank a staggering -3.8% before finding supportive price action around USD $16.50, while platinum made light work of the USD $900 support and similarly palladium lost the USD $1,000 handle.

A muted session for gold on Monday with China and Hong Kong taking leave. The yellow metal opened underneath Friday's close, however was generally well supported in early flows to push back above USD $1,280. A modest bid to the greenback in the afternoon created some headwinds to drag bullion back underneath the figure, however the metal held a narrow range into the European open and didn't extend much lower. Dollar flows look likely to continue to be the main driver of price action over the near term, while we see support toward USD $1,275 and resistance at the recently broken May low of USD $1,282, with extension to USD $1,285. Down-side risks continue to build as ETF positioning remains buoyant and should outflows drive a break of USD $1,275 we could see an extension as far as USD $1,250 - $1,236 (Dec 2017 low). Silver remains above the USD $16.50 pivot point, however is susceptible to a test toward USD $16.10 should gold struggle to find footing at USD $1,275.

 

Although the information in this report has been obtained from and is based upon sources 1StopGold believes to be reliable, we do not guarantee its accuracy and it may be incomplete or condensed. All opinions and estimates constitute 1StopGold' judgment as of the date of this report and are subject to change without notice. This report is for informational purposes only and is not intended as an offer or solicitation for the purchase or sale of an investment. This report does not consider or take into account the investment objectives or financial situation of a particular party.

DAILY REPORT : Tuesday 12 Jun 2018

MACRO: In the absence of economic data releases, U.S. equities ended modestly higher on Monday as participants traded cautiously into Tuesday's meeting between President Donald Trump and North Korean leader Kin Jong Un. The DJIA saw weakness late in trade, however was able to hold onto a +0.02% gain to 25,322.31 points, marking the fourth consecutive session gain. The S&P 500 saw strength across consumer staples (+0.77%) lead eight of 11 components higher to book a +0.11% gain to 2,782.00 points, while the Nasdaq Composite tacked on a further +0.19% to 7,659.93 points. The greenback pushed modestly higher against majors on Monday, booking notable gains against the Japanese yen and the Canadian dollar. The DXY index added +0.1% to reclaim 110.00 against the yen, while the buck broke back above 1.30 against the Canadian dollar as the fall-out continues following the recent G7 summit. Treasury yields held a tight range on Monday, inching higher into the upcoming FOMC meeting. The 10-year added 2bps to 2.959% and the two-year gained 3bps to 2.52%. European markets pushed higher on Monday, with regional bourse's buoyed by a +3.42% gain to the Italian FTSE MIB index. The broad Stoxx Europe 600 jumped +0.73% to 387.94 points, while the German Dax added +0.60% to 12,842.91 points and the French CAC 40 rose +0.43% to 5,473.91 points. In the U.K. the FTSE 100 posted a +0.73% gain to mark the strongest session gain in two-weeks as the pound was sold.

PRECIOUS: Gold saw mixed price action on Monday, however ultimately ended higher and closed above the psychological USD $1,300 level. A sharp stop loss run higher to silver buoyed the yellow metal above USD $1,300 during early Asian trade, however resting offers restricted any further gains and gold gradually slipped back underneath the figure as the Chinese interest in silver ran out of steam. Late Asian trade saw the metal continue to trade heavily, while silver pared the majority of Asian gains in London to further weight upon price action. A move back above 1.18 to the euro underpinned a recovery into the U.S. session, taking gold through the Asian high print to USD $1,302.55, before easing modestly into the close. Silver importantly recaptured the early Asian gains to end the session over +1% higher, while palladium saw strength to extend to a USD $1,022 high for a +0.9% gain.

Pricing to bullion during Asian trade on Tuesday was dictated by dollar flows (DXY index opened notably higher), with gold pressured lower in early session trade as the euro ran through stops around 1.1775. The metal declined underneath USD $1,300 within the first hour of the session and struggled to find the footing necessary for a move back through the figure. Shanghai traded at a premium around USD $6 and we saw modest selling out of China to weigh upon price action, however a bounce to the euro following the early session weakness helped to provide supportive price action to restrict any further declines to the yellow metal. Dollar flows aside, we did see some risk pricing around Trump-Kim Jong Un headlines, notably seeing a small amount of risk premium wiped off the metal on very positive comments from President Trump regarding both the meeting and Kim Jong Un himself. President Trump and North Korean leader Kim Jong Un signed what they described as a "very important, historic and comprehensive" document, the details of which have yet to be made public, however further details are expected from President Trump at a press conference scheduled around 3:30pm Singapore time. Near-term gold pricing should remain rangebound into the major economic events this week, however we may see some volatility around the upcoming comments from President Trump. Data releases today include U.K. employment, German ZEW survey results and U.S. CPI.

 

Although the information in this report has been obtained from and is based upon sources 1StopGold believes to be reliable, we do not guarantee its accuracy and it may be incomplete or condensed. All opinions and estimates constitute 1StopGold' judgment as of the date of this report and are subject to change without notice. This report is for informational purposes only and is not intended as an offer or solicitation for the purchase or sale of an investment. This report does not consider or take into account the investment objectives or financial situation of a particular party.

DAILY REPORT : Wed 6 Jun 2018

MARKETS/MACRO: Positive U.S data didn’t have much of an impact on equities overnight, with both the DJIA and S&P 500 effectively flat. The Nasdaq Composite Index however, registered its second record close in a row Tuesday on the back of a rally in the shares of technology and internet giants Netflix Inc. and Apple Inc., underscoring resurgence in the sector that has been among the market’s more influential. The Dow Jones Industrial Average fell -13.71 points, or -0.06%, to 24,799.98, the S&P500 inched up +1.93 points, or +0.07%, to 2,748.80, while the NASDAQ Composite added +31.404 points, or +0.41%, to 7,637.863. European stock indices closed lower Tuesday weighed by fresh Italian jitters and declining bank stocks. The EuroFirst 300 closed down -4.93 points, or -0.32% at 1,512.64 and the EuroStoxx 600 declined -1.22 points, or -0.31% to 386.89. Regionally, the FTSE100 eased -0.7%, the CAC40 sold off -0.22% and the DAX rose +0.13%. The Dollar Index eased back 0.2% to 93.88 with EUR-USD rebounding strongly off the low of sub-1.1660 to close +0.2% higher around 1.1720. This followed reports that a EU official commented that the upcoming 14 June ECB meeting may see a live debate on a QE exit. Italian bond yields backed up with both the 2Y and 10Y yield up 25bp to 1.0% and 2.79% respectively. US bond yields were slightly lower with the 2Y yield down 2bp to 2.49% and the 10Y yield down 1bp to 2.93%. Crude oil prices suffered a rollercoaster ride (WTI +1.2% to $65.53) as investors remained concerned about rising OPEC supply. Selling emerged after reports suggested that the U.S government had put pressure on OPEC to increase output as gasoline prices rose. A Bloomberg article stated that it asked for an increase of 1mb/d from Saudi Arabia and others. This weakness was reversed later in the session as the focus returned to EIA’s weekly report due out on Wednesday. Investors are bracing themselves for another large draw-down, with a Bloomberg report suggesting it could be as high as 2.1m barrels.

On the data front, U.S. job openings rose to a seasonally adjusted 6.698 million at the end of April (6.35 million expected), a record high. For the first time since such record-keeping began in 2000, the number of available positions exceeded the number of job seekers, the Labour Department said. There were also ample job openings in some of the lowest paying fields. There were 844k accommodation and food service jobs open in April and 735k unfilled retail positions. Still in the U.S, the ISM reported that its non-manufacturing index rose to 58.6 in May (57.7 expected), indicating activity is expanding across service and other industries. ISM’s price index grew to 64.3, largely due to gas price and related transportation cost increases. Rising price tags for steel and aluminium products which are partially related to recent tariff announcements, also contributed to the index’s jump, said Anthony Nieves, who oversees the survey. In the Euro area retail sales gained +0.1% MoM in April (+0.5% expected), slower than the +0.4% increase in March. On a yearly basis, retail sales volume growth accelerated to +1.7% in April from +1.5% percent in March, which came inline with expectation.

PRECIOUS: Gold held above $1290 for a third successive session yesterday, ultimately rallying late in the NY session. The yellow metal opened the day $1292.50 Tuesday and was immediately under pressure, despite mainly buying seen from Asian customers. The SGE showed a steady premium of $6.00 for onshore traders throughout the morning session and the metal chopped between $1291-1293 on light volumes. Over the Chinese lunch break, the market slid off to the days lows just above $1290, yet similar to previous sessions there was good buying interest at that level and we quickly jumped higher. The buying continued as China reopened and the yellow metal hit $1294.50 before easing lower into the London open. By the time NY stepped in we were sitting around $1291-94, but quickly rose higher towards $1300 following the headlines that the ECB may discuss QE exit in the upcoming meeting. EURUSD took off and gold followed, although it was not able to breach $1300 with some decent producer and real money selling emerging there. The metal slowly dipped off over the last few hours of the day closing at $1296. It is becoming more evident that there is growing support for gold on dips, so despite still being caught in a range, there a number participants starting to look at it in a more positive light. Technically, there is a downward trendline dating back to mid-April which has resisted a few time now and currently cuts in at $1302 on a daily chart. A close above this level could open the door for a move to $1320-25.

Another sleeper in Asia today, with the yellow metal providing little in terms of price action. Gold opened at $1296.50 and crept up toward $1298 just before the SGE open. From there it has traded sideways between $1297-1298 with very light volume going through both COMEX and SGE. Silver and the PGM's were equally quiet, being contained to very tight ranges and exhibiting light flows. Currencies were all fairly quiet, with the exception of the AUD, which jumped strongly on a solid Q1 GDP reading (+1.0% QoQ, +3.1% YoY). AUDUSD is currently trading at 0.7655 (+0.5%) after trading to a high of .7664. WTI Crude has continued higher on the day up +0.4% at time of writing at $65.83 and equities are generally higher on the day. At time of writing the Nikkei is +0.45%, Hang Seng +0.45%, ASX200 +0.42% and the Shanghai Composite s slightly lower -0.15%. Not a great deal of data on the cards today, U.S trade balance and Mortgage applications the only data of note.

 

Although the information in this report has been obtained from and is based upon sources 1StopGold believes to be reliable, we do not guarantee its accuracy and it may be incomplete or condensed. All opinions and estimates constitute 1StopGold' judgment as of the date of this report and are subject to change without notice. This report is for informational purposes only and is not intended as an offer or solicitation for the purchase or sale of an investment. This report does not consider or take into account the investment objectives or financial situation of a particular party.