DAILY REPORT : Thursday 13 Sep 2018

MARKETS/MACRO US equities were finished mostly higher amid reports that the US is proposing follow up trade talks with China after last month’s efforts proved fruitless. The Dow added 27.86 points, or 0.11%, to 25,998.92, the S&P 500 inched up 1.03 points, or 0.04%, to 2,888.92, while the Nasdaq fell 18.245 points, or 0.23%, to 7,954.229. There were wins for telecoms (+1.42%) and consumer staples (+1.25%) while financials (- 0.89%) and tech (-0.89%), which was weighed down by a 1.24% loss for Apple on the back of their new iPhone launch, led the laggards. European equities were higher, the EuroSTOXX added 1.77 points, or 0.47%, to 377.08, the German DAX rose 62.03 points, or 0.52%, to 12,032.30, and the London FTSE 100 gained 39.82 points, or 0.55%, to 7,313.36. In the currencies, the US dollar index eased 0.26% to 94.831, the EUR traded up to 1.1646, while USD/JPY was as low as 111.12. US treasury yields were mixed, the 2 year yield firmed 0.8 bps to 2.750% while the 10 year yield lost 1.1 bps to 2.960%. Oil prices were higher as the EIA reported US stockpiles fell by more than expected last week. Brent rose 0.3% to $79.70 while WTI gained 0.4% to $70.27. Base metals were sharply higher, with nickel (+3.2%) leading the way. In US economic data, the Labor Department reported that the producer price index fell 0.1% in August after remaining unchanged in July. The year on year reading was 2.8% while the core PPI year on year rate was 2.3%. In Asia today, as I write the Nikkei is at +0.87%, the Shanghai composite is at +0.04%, the Hang Seng is at +1.27%, and the ASX S&P 200 is at -0.65%. Tonight we have weekly jobless claims, consumer price index, core CPI, and Federal budget numbers out of the US; and the important ECB interest rate decision in the Eurozone.

PRECIOUS Solid session for the precious as gold closes above the $1200 level. Gold opened at $1197 in Asia and was sold to the day’s low $1192 around lunchtime. The SGE premium eased slightly to $3-4 and we saw decent selling from China. London traded $1193-97 through the AM session in the absence of any real catalyst for a move either way. As the US/China trade talk headlines appeared in NY mid-morning USD/CNH promptly dropped from 6.87 to 6.83 and gold took off. The yellow metal gapped up to $1203 initially, then traded steadily to the session high $1208 over the next few hours. There was some late selling off the high which saw the market at $1205 by closing time. Silver printed a week high $14.27 during NY hours before a close in the black at $14.21. In the PGMs, platinum popped above $800 for the first time since last month and palladium closed ahead at $974. The Philadelphia gold and silver index added 3.46%. SPDR Gold Trust holdings were down 0.03% to 745.18 metric tonnes. In Asia today, gold is easing slightly as the USD finds broad interest. The metal opened at $1206.70 and was down around $1204 by the open in China. The SGE premium is slightly firmer at $4 over loco London, and the yellow metal is $1204.70 as I write. Silver printed a low of $14.19 earlier on but has recovered to the opening level at $14.25 as I write. Platinum has been the best performer in Asia today, the metal Is currently sitting at $803.

 

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 7 Sep 2018

MARKETS/MACRO Initial jobless claims in the U.S. declined 10,000 during the week ended September 1, falling to 203,000 (exp: 213,000) to a near 49-year low. The weekly print saw the four-week moving average decline 2,750 to 209,500, while continuing claims eased 3,000 to 1.707 million (exp: 1.720 million) during the week ended August 25. The Markit U.S. services PMI (final) for August eased to 54.8 from a preliminary read of 55.2 and well down on July’s 56.0. The ISM non-manufacturing index surged to 58.5 during August to follow a read of 55.7 during July. Factory orders in the U.S. slipped -0.8% MoM during July (exp: -0.6%), while factory orders ex-transportation inched +0.2% higher MoM. Durable goods orders declined -1.7%, while core capital goods jumped +1.6% to mark the biggest gain since April. ADP employment in the U.S. came in underneath expectations during August, adding 163,000 payrolls (exp: 200,000) from 217,000 during July. Medium size businesses were largely responsible for the gains, adding 111,000 payrolls, while large businesses gained 31,000 employees and small business increased by 19,000. The services sector was responsible for the creation of 139,000 positions, while manufacturing added 19,000 payrolls and construction increased by 5,000. U.S. equities were again under pressure on Thursday as technology and energy names weighed upon the major bourses. The DJIA inched +0.08% higher to 25,995.87 points, while weakness across energy (-1.93%) and technology (-0.81%) took the S&P 500 -0.37% lower to 2,878.05 points and the Nasdaq Composite sunk -0.91% to 7,922.726 points. Mixed trade for the greenback on Thursday, opening sharply lower in Asia before finding a bid in Europe as the euro tested toward 1.16. The buck saw whippy price action in New York around the employment figure, however was able to end the session generally unchanged.

PRECIOUS A disappointing session for gold during Asian trade today, reversing an early session bid tone to slip underneath the important USD $1,200 support into the London open. Bullion saw relatively robust price action in early trade, underpinned by Chinese physical demand to print a USD $1,203.50 session high. The short covering that drove the yellow metal higher on Thursday looks to have been exhausted and as soon as China closed for lunch we saw a change in mentality. Gold immediately turned well offered, breaking briefly through USD $1,200 with little in the way of support around the figure. Ominously for gold, the dollar was offered into the London open, however this provided no support for the metal with sentiment undoubtedly turning negative underneath USD $1,200. Participants continue to fade any rallies through USD $1,200 and until we see a sustained move above the figure, while more importantly a break above USD $1,215, it is difficult to hold long positioning. All eyes today on the U.S. NFP print, however aside from a knee-jerk reaction to a soft figure if that’s the case, it is difficult to see the dollar sustainably lower to buoy bullion. Silver continues to threaten a move underneath USD $14 and if we see a break lower the metal could easily test toward USD $13.70 in a short period of time. Palladium has exhibited weakness over the last 24 hours after failing to break through the 200 DMA, however forwards remain in deep negative to underpin interest. Data today also includes Eurozone GDP and U.K. house prices.

 

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 3 Sep 2018

MARKETS/MACRO The Chicago PMI eased to 63.6 during August (exp: 63.0) from 65.5 previously. The print marked a threemonth low and saw weakness from supplier deliveries, order backlogs and employment. The University of Michigan consumer sentiment index (final) was revised up from earlier estimates, printing 96.2 (exp: 95.5) from an earlier read of 95.3. The major drag on the headline figure was weakness to the current economic conditions index, falling to the lowest level in close to two-years. Equities in the U.S. ended mixed on Friday leading into the Labor Day holiday, however were able to consolidate strong gains across August. The DJIA ended the session off -0.09% to 25,964.82 points, closing the month +2.2% higher, while the S&P 500 inched just +0.01% higher to 2,901.52 points for a monthly return of +3%. The Nasdaq Composite meanwhile gained +0.26% to 8,109.537, ending the month +5.7% higher to mark the strongest August performance for the bourse since 2000. The greenback performed strongly on Friday following failed NAFTA talks between the U.S. and China, climbing around +0.4% on the session. The buck gained +0.5% against the euro to test underneath 1.16, while ending flat against the yen. European equities were sold on Friday on concerns over U.S. trade policy. The Europe Stoxx 600 fell -0.8% to 382.26 points, while the German Dax sunk -1.04% to 12,364.06 points and the French CAC declined - 1.3% to 5,406.85 points. In the U.K. the FTSE 100 collapsed -1.11% to 7,432.42 points to mark a third successive session decline, as concerns over Brexit continue to create uncertainty.

PRECIOUS The Chicago PMI eased to 63.6 during August (exp: 63.0) from 65.5 previously. The print marked a threemonth low and saw weakness from supplier deliveries, order backlogs and employment. The University of Michigan consumer sentiment index (final) was revised up from earlier estimates, printing 96.2 (exp: 95.5) from an earlier read of 95.3. The major drag on the headline figure was weakness to the current economic conditions index, falling to the lowest level in close to two-years. Equities in the U.S. ended mixed on Friday leading into the Labor Day holiday, however were able to consolidate strong gains across August. The DJIA ended the session off -0.09% to 25,964.82 points, closing the month +2.2% higher, while the S&P 500 inched just +0.01% higher to 2,901.52 points for a monthly return of +3%. The Nasdaq Composite meanwhile gained +0.26% to 8,109.537, ending the month +5.7% higher to mark the strongest August performance for the bourse since 2000. The greenback performed strongly on Friday following failed NAFTA talks between the U.S. and China, climbing around +0.4% on the session. The buck gained +0.5% against the euro to test underneath 1.16, while ending flat against the yen. European equities were sold on Friday on concerns over U.S. trade policy. The Europe Stoxx 600 fell -0.8% to 382.26 points, while the German Dax sunk -1.04% to 12,364.06 points and the French CAC declined 1.3% to 5,406.85 points. In the U.K. the FTSE 100 collapsed -1.11% to 7,432.42 points to mark a third successive session decline, as concerns over Brexit continue to create uncertainty.

 

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 12 Sep 2018

MARKETS/MACRO The main theme overnight was cautious optimism and higher much higher oil prices. U.S investors shrugged off the trade war tensions as major US stock markets rose, while elsewhere, Hurricane Florence could hit the United States east coast as early as Friday, which pushed up oil prices. U.S equities rose late in the session in line with positive U.S data and a strong tech sector, the Dow Jones accelerating +113.99 points (+0.44%) to 25,971.06, the S&P500 advancing +10.76 points (+0.37%) and the NASDAQ composite up +48.313 points (+0.61%) to 7,972.474. In Europe, equity markets were a little more subdued closing mildly softer on the day. The EuroFirst 300 index dipped -0.66 of a point (-0.04%) to 1,466.13 and the EuroStoxx 600 declined -0.20 of a point (-0.05%) to 375.31, while regionally the FTSE100 slid -0.08%, the DAX relinquished -0.13% and CAC40 rose +0.27%. The strength in yields continued with the U.S 2y gaining +3.3bp to a decade high of 2.74% and the 10y yield up +4.8bp to 2.98%. The German 10y Bund yield also ticked up +2.9bp to 0.43%. Crude oil prices surged as supply disruptions continued to mount - WTI rising +3.45% to $69.87. Hurricane Florence is threatening the U.S East Coast, with forecasters predicting it will gain strength before it hits landfall, potentially imperilling major oil pipelines. This helped drive gasoline prices nearly +3% higher also. Elsewhere, concerns about falling Iranian exports continue to rise, Iran resorting to storing oil on super tankers, with ship tracking data on Bloomberg showing a sharp rise in floating storage over the past month. Estimates of Iranian exports are now around 1.5mb/d, according to consensus surveys. The Dollar Index gained +0.1% to 95.25, USDJPY jumped +0.5% to 111.63 and EURUSD nudged higher by +0.1% to 1.1606.

On the data front, the number of job openings in the U.S rose to an all-time high of 6.939 million in July 2018 from an upwardly revised 6.822 million a month earlier, and way above market expectations of 6.68 million. The increase in openings was driven by a surge of vacancies in finance and insurance firms (+46k) and non-durable goods manufacturing (+32k), while there was a decline in retail trade (-85k), educational services (-34k), and federal government (-19k). Meanwhile, hiring increased to 5.679 million in July from 5.677 million in June. Across the pond, the ZEW Indicator of Economic Sentiment for Germany rose by +3.1 points from the previous month to -10.6 in September 2018, beating market expectations of -14.0. It was the highest reading since May, as fears regarding the economic development have diminished somewhat, which may in part be attributable to the new trade agreement between the USA and Mexico. Meanwhile, the assessment of the current economic situation in the country increased by +3.4 points to 76.0 in September. UK unemployment held steady at 4% in the three months to July 2018, its jointlowest since 1975 and in line with market consensus. The number of unemployed declined by -55k from the February to April period while employment rose by +3k and the number of job vacancies hit a fresh record high. Meanwhile, annual wage growth picked up from a nine-month low as businesses found it harder to recruit staff.

PRECIOUS Gold and silver both had constructive bounces after hitting the lows during early NYK yesterday, the former managing to close just off the days high. Gold opened around $1195.50 and was once again under a bit of pressure for the first half of the day. The market dipped down to $1194 on the China open as Asian buying on the exchange was muted and not really providing anything in way of support. The SGE premium as a result slipped from the previous session, trading down to between USD $5.50-6.50/oz over the loco London price. There was some modest early demand from European traders in line with a firming EUR and softening dollar, the metal pushing as high as $1197.50 before easing from there. In the NY session it was all selling initially with the yellow metal retreating back below $1190 as the USD bounced back and commodities in general - with the exception of oil - were sold. Around the time the stellar ADP Employment figure was released, sentiment changed and some demand was seen across the precious. This continued for the remainder of the session, gold clawing its way to a fresh intra-day high of $1199.30 with 30 minutes to go and closing only slightly off that. Silver followed gold for the majority of the day, pushing through the previous low ($14.00) to touch its lowest point since January 2016. A number of stops were tripped on the break of $14.00 although it did manage to hold at $13.95 which was a little surprising. Once gold started to rebound silver also clawed back towards $14.15 and closed at that level. We remain range-bound for now across the metals with the ongoing trade tensions likely drivers of direction over the short term.

There was some profit taking around following the overnight rally during the early Asian hours this morning. This was compounded around the time that Shanghai came in, with China again showing little demand. After initially trading at $1198, gold meandered lower throughout the AM session, giving up some $5 to trade as low as $1193 right on the SGE close. The metal traded fairly flat throughout the lunch hours and since the re-open has exhibited a bit of an upswing, trading around $1194.50 as I write. Silver is currently a little softer on the day although has held $14.10 so far. PGM's are mostly flat or a touch softer so far. The USD is marginally stronger vs. majority of the G10 (JPY the exception), equities a touch lower with the Nikkei currently -0.4%, Hang Seng -0.15%, ASX200 -0.1% and the Shanghai Composite is bucking the trend up +0.25%. Ahead on the data calendar today we have EuroZone Industrial Production and U.S PPI, Mortgage Applications and Beige Book. 

 

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 6 Sep 2018

MARKETS/MACRO Mortgage applications in the U.S. eased modestly during the week ended August 31, slipping -0.1% to mark the seventh fall in 8 weeks following a -1.7% decline the week prior. The U.S. trade deficit widened to a five-month high during July, with notably the gap with China reaching a record high. The Commerce Department reported the trade deficit increased 9.5% to USD $50.1 million (exp: USD $45.7 million) as imports hit a record high. Equities in the U.S. ended mixed on Wednesday, largely a result of weakness across the technology sector as executives from Facebook and Twitter testified before the Senate Intelligence Committee into foreign governments’ use of social networks to spread misinformation. The DJIA inched +0.09% higher to 25,974.99 points, while heavy trade to technology (-1.34%) offset gains to consumer staples (+1.18%) and utilities (+1.27%) to see the S&P 500 down -0.28% to 2,888.60 points. The Nasdaq Composite meanwhile collapsed -1.19% to 7,995.172 points. The greenback softened in New York on Wednesday (DXY -0.3%), notably falling against the British pound following news that Germany would be willing to accept a less detailed Brexit agreement with the U.K. The Pound added +0.43% after tempering gains late, while the euro reclaimed the 1.16 handle to add +0.4%. U.S. treasury yields were mostly unchanged following the trade deficit release, seeing the 10-year around 2.90% and the two-year holding 2.65%. Markets in Europe exhibited weakness on Wednesday on the back of concerns over trade. The Stoxx Europe 600 was off -1.09% to 375.68 points, while the German Dax fell - 1.39% to 12,040.46 points. In the U.K. the FTSE 100 declined -1.00% to 7,383.28 points as the pound jumped late in trade on Brexit headlines.

PRECIOUS A positive session for gold on Wednesday as bargain hunters and a softer dollar underpinned a bid tone. The metal saw support toward USD $1,190 in early Asian trade, while interest out of China saw the metal extend toward USD $1,195 before layered offers weighed upon the price action. Mixed dollar flows kept the yellow metal within a narrow range in London, until the Brexit headlines gave the precious a boost to see bullion finally through USD $1,195 to hold a +0.4% gain into the close. Vols were largely unchanged to see 1m sit just underneath 10, while ETF’s recorded inflows of 50k ounces. Silver tested a move toward USD $14.10 in early European trade, however saw interest in New York to touch a USD $14.22 high and end with a +0.3% gain. Platinum was well bid during U.S. hours to gain +0.8%, while palladium underperformed to end -1% lower.

Asian trade today saw mixed interest in the precious, testing toward USD $1,200 in early trade on the back of dollar weakness, before sliding lower during the afternoon. The greenback traded heavily into the Chinese open, notably against the yen following BOJ headlines, however attempts by gold to move through the psychological figure were met with heavy selling pressure. Shanghai traded at a USD $6 premium over London gold to underpin robust price action, however once the far East took lunch, the bids were removed from the market and bullion eased toward the overnight break-out level of USD $1,195. Afternoon trade saw the metal track back toward USD $1,197 to end flat on the session. Gold remains sensitive to dollar flows and will look toward reclaiming USD $1,200 if it is to constructively move higher. Support extends broadly through USD $1,190 - $1,195 over the near-term and we are starting to see signs of a base around this level.

Data today includes German factory orders, U.S. ADP employment, U.S. initial jobless claims, U.S. Markit services / composite PMI, U.S. ISM non-manufacturing index, U.S. factory orders and U.S. durable goods orders.

 

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 31 Aug 2018

MARKETS/MACRO U.S. personal income increased +0.3% MoM during July (exp: +0.4%), while personal spending matched estimates at +0.4% MoM. Core PCE inched up to +0.2% MoM from +0.1% previously, to see the annualized rate to +2.0% YoY. Initial jobless claims in the U.S. increased 3,000 to 213,000 during the week ended August 25 (exp: 212,000). The print saw the four-week moving average ease 1,500 to 212,250, while continuing claims declined 20,000 to 1.708 million during the week ended August 18. Equities in the U.S. snapped a four-day winning streak on Thursday, weighed down by a report that President Trump is likely to go ahead with planned tariffs on $200 billion of Chinese goods. The DJIA slipped -0.53% to 25,986.92 points, while weakness across materials (-1.25%) weighed upon the S&P 500 to have the bourse -0.44% lower to 2,901.13 points. The greenback saw mixed trade on Thursday, however ultimately ended higher after clawing back recent declines against the euro and the yen. European stocks tracked lower on Thursday, largely weighed down by concerns over the upcoming Italian budget. The Stoxx Europe 600 softened -0.32% to 385.36 points, while the German Dax declined -0.54% to 12,494.24 points and the French CAC shed -0.42% to 5,478.06 points. In the U.K. the FTSE 100 sank -0.62% on the back of further sterling strength.

PRECIOUS A relatively buoyant session for bullion during Asian hours on Friday, reclaiming the USD $1,200 handle following the New York weakness on Thursday. Interest was largely reserved for Chinese trade, with weakness to USD/China during early Shanghai hours underpinning a bid tone for the metal to see the Shanghai premium hold toward USD $6. Comments from the ECB’s Edwald Nowotny hit the wires in the afternoon, assuring markets that Italian concerns are unlikely to delay the central bank’s plans to hike interest rates. The news saw the euro add around +0.22% to underpin a move through USD $1,205 for bullion, however the metal still remains at the mercy of dollar flows and continues to struggle to make headway above the psychological USD $1,200 figure. Silver was able to hold the USD $14.50 support during early Asian trade before benefitting from the afternoon dollar weakness, while platinum remains heavy toward USD $800 and palladium continues to benefit from a physical deficit although is subject to whippy trade.

 

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 11 Sep 2018

MARKETS/MACRO U.S. stocks ended mixed on Monday, generally supported by a recovery to the tech sector to see both the S&P 500 and the Nasdaq Composite snap a 4-session losing streak. The DJIA eased -0.23% to 25,857.07 points, while the S&P 500 saw strength across utilities (+0.58%) and real estate (+0.54%) to end the session +0.19% higher at 2,877.13 points and the Nasdaq Composite gained +0.27% to 7,924.16 points. U.S. treasury yields traded mixed on Monday to take the curve toward the flattest level since 2007. The two-year yield added around 0.8bps to 2.714%, the highest level since mid-2008, while the 10-year yield eased 0.7bps to 2.937%. The greenback meanwhile tracked lower following Brexit headlines that an agreement may be reached in the coming weeks. The DXY index ended off -0.27% after booking notable declines against the British pound (GBP/USD +0.81%) and the euro (EUR/USD +0.39%), however commodity currencies such as the Australian dollar continue to struggle amid U.S. – China trade concerns. Oil futures traded mixed on Monday as U.S. prices suffered from demand concerns as a result of Hurricane Florence. WTI ended the session down -0.3% at USD $67.50 per barrel, while Brent crude tacked on USD +0.7% to USD $77.37 per barrel. European equity markets traded broadly higher on Monday, largely ignoring a stronger euro and Swedish political headlines. The Stoxx Europe 600 tacked on +0.47% to 375.51, the German Dax added +0.22% to 11,986.34 points and the French CAC closed +0.33% higher at 5,269.63 points. In the U.K. the FTSE 100 inched just +0.02% higher to 7,279.30 points as a stronger pound weighed upon the market.

PRECIOUS An anaemic session for gold during Asian trade today, held within a narrow range an unable to capitalise on a weaker greenback. Bullion held above USD $1,195 throughout early session pricing, however struggled to entice Chinese demand once Shanghai opened and eased into their lunch break as the metal held at around a USD $6 premium. Interest toward USD $1,193 kept price action relatively buoyant during the afternoon, however flows were lighter than we are used to seeing and it looks as though participants are treading water until the metal breaks outside of the recent range. The latest COTR data has shown a further increase in short position and this does increase the likelihood that we may see a short squeeze over the near-term should the metal make sustainable break above USD $1,200, with focus on the key resistance level through USD $1,215 - $1,220. Silver once again tested toward USD $14.10 during Asian trade today, however saw resting bids restrict a further test of the important USD $14 support. The grey metal has broken above USD $14.20 in recent sessions, although rallies are being sold into and thus far the metal hasn’t been able to extend away from USD $14 (gold/silver ration in focus). 2 Platinum tracked sideways today following the overnight squeeze through USD $800 and reversal (short dated borrowing seen overnight), while palladium was sold in New York on a test of the 200 DMA (again!) and held a narrow range in Asia today. Data releases today include U.K. employment data, German ZEW survey results, U.S. small business optimism, the U.S. JOLTS job openings 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 : Wed 5 Sep 2018

MARKETS/MACRO Global equities have started September on the backfoot, losing a little more ground overnight amid growing EM concerns and ongoing uncertainty regarding the NAFTA deal. The small losses came despite Amazon Inc becoming only the second publicly listed company in the U.S to exceed a market cap of USD $1 trillion – its stock price doubling in less than a year. The DJIA slipped -12.34 points (-0.05%) to 25,952.48, the S&P500 relinquished -4.80 points (-0.17%) to 2,896.72 and the NASDAQ Composite decreased -18.292 points (-0.23%) to 8,091.246. Europe fared even worse on the day, the EuroFirst 300 index toppling -0.74% to 1,484.91 and EuroStoxx 600 lost -0.7% to 379.83. Regionally the DAX shed - 1.1%, the FTSE100 dropped -0.62% and CAC40 plunged -1.31%. Crude oil prices started the session strongly, amid ongoing concerns about falling Iranian oil exports. Reports of a tropical storm in the Gulf of Mexico also added to these fears of supply disruptions. However, the re-emergence of emerging market turmoil in currency markets saw the USD push sharply higher, which resulted in the earlier gains being quickly wiped out. After briefly pushing above USD $71/bbl, WTI prices fell to below USD70/bbl where they remain. In the G10 FX space, commodity currencies continued to underperform as crude took its step back, while the Euro continues to consolidate after failing to convincingly break through the 1.17 level last week – EURUSD at last count is 1.1605. Emerging market concerns remained at the fore yesterday, with the South African economy contracting - 0.7% QoQ annualised in Q2 vs expectations of a +0.6% rise after the -2.6% contraction in Q1. This was the weakest growth in over two years and the first recession for the country since 2009. USDZAR rose +3.3% to 15.34 as result, the highest level in more than two years. There was also no respite for the Argentinian peso as USDARS rose another +1.2% to 38.95. The Mexican peso also came under selling pressure on contagion from the EM sell-off with USDMNX up +1.1% to 19.40.

The Institute for Supply Management’s Manufacturing PMI in the U.S jumped to 61.3 in August of 2018 from 58.1 in the previous month, beating market expectations of 57.7. The reading pointed to the highest expansion in factory activity since May of 2004 amid faster increases in new orders, production, employment, inventories and lower inflationary pressures. However, manufacturers remain overwhelmingly concerned about tariff-related activity, including how reciprocal tariffs will impact company revenue and current manufacturing locations. Elsewhere, U.S construction spending edged up +0.1% from a month earlier to a seasonally adjusted annual rate of USD $1.32 trillion in July 2018, following a downwardly revised -0.8% drop in June, missing market expectations of a +0.5% rise. Investment in public construction projects rose +0.7% in July (-1.7% in June), boosted by a rebound in spending on federal government construction projects. Meanwhile, private residential project outlays fell -0.1% as spending on private non-residential structures, which includes manufacturing and power plants, dropped - 1.0%, the biggest decline since August 2017.

PRECIOUS Bullion extended recent weakness on Tuesday amid a stronger greenback, with the dollar hitting the highest level since late July against the Canadian dollar as trade talks between the two parties continue to show no signs of progress. Price action during Asian trade was relatively robust to see the yellow metal hold around USD $1,200, however it wasn’t long until the dollar regained the ascendancy to weigh upon bullion. Early offers out of London saw gold sharply lower through USD $1,200, with the metal finding some respite around USD $1,193 leading into New York trade following Monday’s Labor Day holiday. Price action in the U.S. was mixed, however skewed to the downside, briefly flirting with a break underneath USD $1,190 before recovering back toward the support level found in Europe into the close. After failing to capture the USD $14.50 pivot point in recent sessions, silver was resoundingly sold on Tuesday, in essence leading the remainder of the precious lower. The grey metal hit stops around the previous USD $14.40 low and extended losses throughout the session to test USD $14 in New York and book a staggering -2.5% decline. Platinum shed -1.37% and moved further away from the important USD $800 handle, while palladium collapsed -2.6% in Europe, only to turn bid in New York and sharply reverse declines to end flat on the session.

Bullion experienced a mild bid tone during Asian trade today, however participants remained cautious following the recent precious weakness and firming dollar, notably against emerging market currencies. Interest was predominately Chinese driven as USD/China softened in early trade, however heavy offers through USD $1,194 restricted further top-side gains. The metal is precariously poised and could well see further weakness toward USD $1,180 and even the recent low of USD $1,160 should the greenback continue to strengthen. Emerging market currencies are unable to gain a foothold against the dollar and the recent correlation between the euro and gold continues to hold. Vols have ticked higher following the recent price action, with 1m pushing toward 10, while ETF’s shed a further 250,000 ounces on Tuesday Silver held above USD $14 during Asian trade today, however remains subject to high volatility and could see weakness extend toward USD $13.70 - $13.80. Data releases today include Markit services/composite PMI prints from Italy, France, Germany, the U.K. and the Eurozone. We also see U.S. trade balance and U.S. mortgage applications.

 

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 30 Aug 2018

MARKETS/MACRO US equities continued to rise, with both the S&P 500 and the Nasdaq posting record finishes for the fourth consecutive session. The Dow added 60.55 points, or 0.23%, to 26,124.57, the S&P 500 rose 16.52 points, or 0.57%, to 2,914.04, while the Nasdaq gained 79.65 points, or 0.99%, to 8,109.469. There were wins for consumer discretionary (+1.12%) and tech (+1.01%) while telecoms (-0.76%) led the laggards. European equities were mostly higher, the EuroSTOXX advanced 1.12 points, or 0.29%, to 386.58, the German DAX put on 34.26 points, or 0.27%, to 12,561.68, and the London FTSE 100 lost 54.01 points, or 0.71%, to 7,563.21. In the currencies, the US dollar index fell 0.20% to 94.53, the EUR traded up to 1.1709 despite dipping as low as 1.1656 in early London hours, while USD/JPY traded up to 111.81. US treasury yields were higher, the 2 year yield firmed 1.0 bps to 2.676% while the 10 year yield added 0.4 bps to 2.884%. Oil prices were higher as the EIA reported a draw of 2.6 million barrels in crude oil inventories. Brent picked up 1.86% to $77.36 while WTI rose 1.75% to $69.73. Base metals were mostly lower, with nickel (-1.28%) leading the losses. In US economic data, GDP grew at a 4.2% annualized rate in the second quarter, the figure was revised up from the preliminary estimate of 4.1% and slightly ahead of economist’s expectations. Pending home sales fell 0.7% in July following a 1% rise in June. In Asia today, as I write the Nikkei is at +0.25%, the Shanghai composite is at -0.81%, the Hang Seng is at - 0.61%, and the ASX S&P 200 is at +0.16%. Tonight we have weekly jobless claims, personal income, consumer spending, and core inflation out of the US; business confidence, services sentiment, consumer confidence, consumer inflation expectations, economic sentiment, and industrial sentiment out of the Eurozone; and also unemployment and inflation data out of Germany.

PRECIOUS Quiet session for the precious as gold hangs on above $1200. Gold opened at the day’s low of $1200 and saw a mild bid tone through Asian hours. China were light buyers with the SGE premium was around $7- 8 despite USD/CNH firming through the session. The market hovered between $1202-05 through the London AM session in thin volume. The US dollar came under pressure in early NY trading, gold hit $1206 before retracing slightly, then printed the session high $1207 just before the close. Silver remained range-bound through the session before closing modestly higher at $14.72. Palladium was the stand-out performer, climbing $22 to close right at the $963 high. The Philadelphia gold and silver index added 0.23%. The SPDR Gold Trust holdings remained unchanged at 759.87 metric tonnes. In Asia today, USD/CNH is trending higher again which put gold under early selling pressure. The SGE premium has eased to $5-6 over loco London and we are seeing selling from the Chinese banks. Gold bumped up to $1207.60 just after the open and has been losing ground ever since, the yellow metal is currently sitting at 2 $1201.50. Silver is also softer, the grey metal is at $14.65 as I write. PGMs are trading lower, with platinum dropping $9 to a low of $787. Gold is just ahead of the psychological support at $1200, next level below that would be last week’s low of $1183. On the upside, there should be resistance at Tuesday’s high of $1214 and plenty of sellers around the 55 DMA at $1227. 

 

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 10 Sep 2018

MARKETS/MACRO Jobs data out of the U.S on Friday exceeded expectations to show 201,000 payrolls added during August (exp: 190,000). There were downwards revisions to the last two months totalling 50,000, however the 12- month average held just underneath 200,000. The unemployment rate held at 3.9% during August (exp: 3.8%), while the broader underemployment rate, which takes into account discouraged workers eased to 7.4% from 7.5% previously. Average hourly earnings increased +0.4% MoM to see the annualised figure at +2.9% YoY (exp: +2.7%). Equity markets in the U.S. ended lower on Friday following comments from President Trump regarding a further USD $267 Billion in tariffs directed toward China. The DJIA ended - 0.31% lower at 25,916.54 points, sliding -0.2% on the week, while the S&P 500 declined -0.22% to 2,871.68 points, ending the week -1% down. The technology sell-off continued to weigh upon the Nasdaq Composite, seeing the bourse -0.25% down on Friday to 7,902.542 points and -2.6% softer over the week. The greenback received a boost following the U.S. wages growth on Friday, seeing the DXY index add +0.41% on the session. The buck made notable gains against the Australian dollar (AUD/USD -1.4%) as the U.S. – China trade war continues to weigh upon the commodity dependent currency.

PRECIOUS Continued dollar strength weighed upon bullion during Asian trade on Monday, with the metal unable to reclaim the USD $1,200 handle following Friday’s wage / payrolls driven weakness. The short-covering rally that drove price action higher last week looks to have been exhausted and we are now once again looking toward near-term weakness for bullion. A mild bid tone out of China supported price action during Shanghai trade, however the physical interest out of the far East wasn’t enough to counteract persistent dollar strength, notably against USD /China as CNY fixed around +0.3% higher than closing levels on Friday. The yellow metal extended to a USD $1,191.70 low during late afternoon trade and will look for support toward USD $1,190 to restrict further declines. The latest COTR data shows a further decrease in net positioning, largely driven by an increase in gross shorts, while gross longs were also reduced. Overall positioning is supportive for further short covering; however it is currently difficult to see a catalyst for a sustained move above USD $1,200, with further extension through USD $1,215 the key for near to medium term reversal in trend. Silver remains resilient above USD $14 and will need to hold the figure to restrict a test toward USD $13.70 - $13.80, while platinum continues to trade between USD $750 - $800 and palladium remains in backwardation to underpin interest in the metal. Data today includes U.K. manufacturing / industrial production and U.S. consumer credit.

 

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 4 Sep 2018

MARKETS/MACRO Muted markets on Monday as the U.S. took a break for the Labor Day holiday. Equities across Europe ended modestly mixed with trade concerns still in the forefront of investors minds. The Stoxx Europe 600 inched +0.07% higher to 382.51 points as the euro held around 1.16, while the German Dax slipped - 0.14% to 12,346.41 points and the French CAC added +0.13% to 5,413.80 points. Comments from the EU’s top Brexit negotiator, Michel Barnier regarding U.K. Prime Minister Theresa May’s proposals saw the pound under pressure on Monday, sliding -0.38% to close underneath 1.29. The weakness however supported the local stock market, helping the FTSE 100 to a +0.97% return on the session. Oil futures pushed higher on Monday on concerns over Iranian output. WTI added +0.23% to end around USD $70.10 per barrel, while Brent Crude tacked on +0.27% to USD $78 per barrel.

PRECIOUS Quiet trade for bullion on Monday with New York closed, seeing the metal oscillate within a tight range either side of USD $1,200. Dollar flows were relatively sedate and provided little in the way of direction for the metal, while a lack of ‘trade-war’ headlines further weighed upon volatility and enthusiasm in general for the precious complex. Early Asian offers saw gold underneath USD $1,200, however physical demand out of China soon had the metal reversing these declines as the on-shore premium held toward USD $7. Bullion continued to see interest during European hours to generally hold above USD $1,200 and end the session above the figure to book a modest gain. Tuesday’s Asian session once again saw early session offers take the metal underneath USD $1,200 only to see interest out of Shanghai reverse this weakness. A move lower to USD/China initially underpinned the recovery, however the bid tone soon ran out of steam as the greenback gained traction to move through the previous session high. Further dollar strength late in afternoon trade saw the metal extend further to the down-side, with USD/China breaking higher to weigh upon price action. Support initially sits around USD $1,195, while a break through this level may see USD $1,180 - $1,185 tested. Silver hasn’t been able to hold the key USD $14.50 pivot point in recent sessions and could open up a test toward USD $14 should support at USD $14.40 not hold. Palladium continues to outperform the remainder of the precious and is the only metal that is net long, while shorts in the remainder sit toward or at all-time highs. With forwards in heavy backwardation the metal is likely to continue to see interest underpin the metal. Data today includes Markit U.S. manufacturing PMI, U.S. construction spending, ISM U.S. manufacturing and ISM U.S. prices paid.

 

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 29 Aug 2018

MARKETS/MACRO Risk traded largely sideways overnight following the strong gains in U.S equities the day earlier, with the S&P500 ending the session largely unchanged - albeit closing on a third consecutive record high. U.S stocks dug in on the back of optimism surrounding a Mexico/U.S NAFTA deal and a consumer confidence measure hit a near 18 year high. The S&P500 closed slightly higher up +0.78 of a point (+0.03%) at 2,897.52 after briefly crossing 2900 for the first time ever earlier in the day. The Dow Jones Industrial Average gained +14.38 points (+0.06%) to 26,064.02 and the NASDAQ Composite ran +12.144 points higher (+0.15%), remaining above 8,000 at 8,030.039. European stocks inched lower, after struggling for direction for much of the session amid trade optimism that lifted the Euro to its strongest level against the Greenback since July. UK stocks returned to trading after Monday's Summer bank holiday and posted their best day in almost two weeks. Metals and mining companies propelled the FTSE100's advance (+0.52% to 7,617.22) on the heels of a U.S/Mexico trade deal that brightened the equities outlook. The EuroFirst 300 Index dipped -0.71 of a point (-0.05%) to 1,507.84 and the EuroStoxx 600 edged down -0.11 of a point (-0.03%) to 385.46. In the macro space, we saw 10y yields advance for another day (+3.5 bps to 2.88%) after finding decent support around the 2.81% level earlier in the week, while the dollar finished largely where it started the day against its G10 peers. WTI Crude oil fell from multi-week highs (-0.5% to $68.53), on news OPEC's oil production is increasing and getting closer to a level of full compliance, according to the U.A.E. Energy Minister & OPEC President. The API is also said to report U.S. crude stocks rose +38K bbl last week.

Markets continue to remain in anticipation of further developments on the NAFTA front with the onus now on the US and Canada to reach an agreement. Both the Canadian PM and foreign minister have expressed optimism, however, significant disagreements exist particularly when it comes to the remedial process with Canada insisting on the existence of anti-dumping panels to resolve disputes. U.S. Treasury Secretary Steve Mnuchin said on Tuesday he believed the United States can reach a trade deal with Canada as early as this week after coming to an agreement with Mexico. "I think our objective is to try to get Canada aboard quickly", Mnuchin said in an interview with CNBC. The United States and Mexico agreed on Monday to overhaul the North American Free Trade Agreement (NAFTA), putting pressure on their northern neighbour to agree to new terms on auto trade and dispute-settlement rules to remain part of the three-nation pact.

On the data front overnight, the Conference Board’s measure of U.S consumer confidence rose to the highest level since October 2000 in what was an all-round strong print. Consumer confidence lifted to 133.4 from 127.9 (beating expectations of 126.5), present situation lifted from 166.1 to 172.2 and future situation increased from 102.4 to 107.6. The data suggests consumption will be supported through Q3 and with November mid-terms just around the corner, elevated levels of consumer confidence are very positive for the Republican Party. Elsewhere, the U.S trade deficit widened more than expected to $72.2bn in July from $67.9bn, with exports slipping -1.7% and imports up +0.9%. Further, U.S wholesale inventories beat expectations, rising +0.7% MoM in July. If sustained, the lift in inventories will help certainly boost GDP in Q3. ANZ bank in piece did argue however that "some of the stock build could be related to companies raising inventory levels prior to the introduction of tariffs against key trading partners, particularly China".

PRECIOUS Gold chalked up a fresh recovery high overnight ($1214.15), although reversed all the intra-day gains and sold off back toward $1200 following the better than expected U.S data and positive inroads to a NAFTA deal. The yellow metal kicked off proceedings in Asia yesterday with some modest demand seen around $1210, assisted by a weaker USD which kept things fairly buoyant up until China commenced their day. Flows were fairly subdued with some moderate sized buy clips going through the SGE, although we think traders were expecting more. As a result, the market dipped throughout the am session trading as low as $1208 bid, before showing some signs of life again in the early Asia pm session. Some North Korea headlines on Pompeo, helped gold catch a bid during early London and the metal made a gradual climb to the daily high by the time NY opened up shop. The very strong consumer confidence numbers and Richmond Fed activity index, drove the dollar higher and gold came crashing back through $1210 and never recovered. We held around $1208 for a time, with some heavy spec driven profit taking late in the day pressuring prices back toward $1200. Eventually we closed out the session on a soft note at $1201.50. We feel dips below $1200 should be supported for the interim and look for a retest of $1215 in the near term, a break of which will make shorts nervous. Silver rose in conjunction with gold throughout Asia and London yesterday although ran into some heavy selling towards $15.00. It brushed that level before capitulating throughout the NY session to $14.70, with some fairly heavy volume going through.

The yellow metal remained quite reserved today in terms of price action, making a slow and steady push higher over the first hour of trade and then continuing at a snails pace into the afternoon. We opened a touch above $1201 and slowly meandered up toward $1202.50 by the time Shanghai opened for business. They again had modest demand, although volume was a little disappointing given the overnight roll-back. The premium still remained healthy though and in the middle of the recent range at around USD $6-6.50 over the loco London price. Over the afternoon the metals continued to creep higher, although there was no real conviction behind it, rather a light softening of the USD through the SGE break. As I write we have just reopened and the USD has turned north against the CNH / CNY and AUD and is consequently dragging the metal a touch lower. Ahead today we have U.S GDP data, which will be the main focus (+4.0% QoQ annualised expected) and we suspect things will remain fairly subdued until then. Also to be released is French GDP, German consumer confidence and U.S pending home sales and mortgage applications. 

 

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.