DAILY REPORT : Tuesday 20 Jun 2017

MACRO: New York Federal Reserve President William Dudley spoke on Monday, noting that he is largely ignoring signals of concern from the bond market and that he believes the U.S. economy is in good shape. With regards to the low U.S. bond yields, Dudley commented that compared to Japan and Europe U.S. yields are actually relatively high. Strong gains to technology shares following the recent weakness across the sector helped to propel equities higher in the U.S. on Monday, taking both the DJIA and the S&P 500 to record closing levels. The DJIA (+0.68%) ended the session on the high print to mark a fresh intraday record and closing level record of 21,528.99 points. The S&P 500 gained +0.83% to end at a fresh record closing level of 2,453.46 points, touching a fresh intraday record of 2,453.82 in the process as gains to technology (+1.66%), healthcare (+1.08%) and financials (+0.98%) underpinned the move higher. The Nasdaq Composite (+1.42%) posted its largest single-session gain since early November as Apple (+2.86%) booked its largest one-day advance since February, while Facebook (+1.48%) and Amazon (+0.76%) also had positive sessions. Oil futures saw heavy price action on Monday, sold lower in New York to pare European session gains. Global benchmarks continue to suffer from oversupply concerns as WTI slumped over -1% to close at USD $44.20 and book the lowest close since November, while Brent crude sunk close to USD $0.50 or -1% to close at USD $46.91 per barrel. The greenback pushed higher on Monday after seeing interest following New York Federal Reserve President William Dudley's hawkish comments, seeing the DXY index add +0.4% as USD/JPY pushed higher to reclaim the 111.00 handle. Markets in Europe turned higher on Monday, with risk back on the table following French President Emmanuel Macron's party winning a majority in French parliamentary elections on Sunday (won 350 of 577 seats). The Stoxx Europe 600 added +0.86% to book the largest single-session gain in nearly two months, while the French CAC 40 gained +0.9% and the German Dax surged +1.07% to a fresh record close at 12,888.95 points. In the U.K. the FTSE 100 saw strength from materials and industrials to end +0.81% higher.

PRECIOUS: Precious metals saw further weakness on Monday, trading offered throughout the session as the USD turned higher. Gold saw early Asian interest take the metal toward USD $1,255 in low liquidity, however offers soon restricted any further top-side gains once Tokyo opened for business. China traded with a mild bid bias (USD $9 premium) to keep the price action buoyant above USD $1,250, however the yellow metal struggled against USD headwinds in Europe and in particular the U.S. to break below the USD $1,250 support. Gold ended the session toward the low print, booking a -0.8% decline as ETF flows continue to weigh upon the metal (-22k ounces on Monday). Mixed USD trade provided some respite for gold during Asian trade on Tuesday, with modest physical interest out of the region evident underneath USD $1,250, however not to the extent we expected we would see. Chinese demand in afternoon trade pushed gold to the session high just underneath USD $1,247, however with both USD/CNY and USD/CNH pushing higher in recent weeks we may be seeing this weigh upon regional demand to some extent. The next key level of support sits around USD $1,240, with a broad extension to the 200 DMA around USD $1,237. After sliding below USD $16.50 in New York on Monday, silver staged a modest recovery during Asian hours today to consolidate above the figure and touch a USD $16.60 session high late in trade. The grey metal has lost nearly -7% since reaching USD $17.75 just 2-weeks ago and will look toward support around USD $16.40 to restrict further declines. Data releases today include German PPI and the U.S. Current Account Balance.

 

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 14 Jun 2017

MARKETS/MACRO: US Attorney General Jeff Sessions appeared before the Senate Intelligence Committee to answer questions relating to the investigation of Russian interference in the 2016 presidential election. Mr Sessions stated unequivocally "I have never met with or had any conversations with any Russian or any foreign officials concerning any type of interference with any campaign or election in the United States". Mr Sessions refused to discuss contents of his conversations with President Trump, despite Democratic senators repeated requests for him to do so. Mr Sessions said: "Consistent with longstanding Department of Justice Practice, I cannot and will not violate my duty to protect confidential communications with the President". US equities were higher as the tech sector rallied, both the Dow and S&P 500 finished at record highs. The Nasdaq rebounded after a pullback of 2.31% finishing on Monday, shares of Apple, Alphabet, and Tesla all rose as the tech-heavy bourse added 0.7%. The Dow added 92.8 points, or 0.44%, to 21,328.47, the S&P 500 gained 10.96 points, or 0.45%, to 2,440.35, and the Nasdaq rose 44.9 points, or 0.73%, to 6,220.37. There were wins for materials (+1.26%), tech (+0.80%) energy (+0.79%) with telecoms (-0.99%) the only laggard. European shares were mixed, the EuroSTOXX increased 2.13 points, or 0.55%, to 388.75, the German DAX advanced 74.54 points, or 0.59%, to 12,764.98, whilst the UK FTSE lost 11.43 points, or 0.15%, to 7,500.44. In currency markets, the US dollar softened as the Federal Reserve began it's 2 day policy meeting. The US dollar index fell 0.1% to 96.671, the EUR traded up to 1.1219, while USD/JPY traded down to 109.92. US treasury yields were higher ahead of the Wednesday's decision on interest rates, 2 year yields firmed 1.2 bps to 1.36% whilst 10 year yields rose 0.2 bps to 2.21%. In commodities news, base metals were mostly lower with copper (-0.95%) taking the biggest hit. In US economic data, the producer price index was flat in May following a 0.5% increase in April, the flat reading was attributed to lower gas prices during the month. The National Federation of Independent Business said it's small business optimism index held steady at a seasonally 104.5 in May, as business owners cling to hope that the Trump administration will deliver on tax reform and other election promises. In Asia today, as I write the Nikkei sits at +0.09%, the Shanghai composite is at -0.58%, the Hang Seng at -0.26%, and the ASX S&P 200 is at +0.71%. All eyes on New York tonight for the FOMC policy meeting, the Fed is widely expected to raise interest rates by 0.25% however investors will be focusing on the forecast for further hikes during 2017. We also have consumer prices, retail sales, and business inventories out of the US; with industrial production and employment data out of the Eurozone.

PRECIOUS: Gold traded a $5 range around the previous session's closing level during Asian hours as the SGE premium rose to $9 above loco London. The yellow metal was sold to $1261 during London AM and reached the days low of $1260 just after NY open. From here the market rallied as USD/JPY dipped below 110, the metal posted the days high of 1268 before settling around $1265 at the close. Silver opened at the high and drifted steadily to the days low of $16.70. Despite the rally in NY, the grey metal finished the day 10c down. PGMs saw profit taking, with palladium popping it's head above above the $900 level before shedding 2.5% to close at $882. The Philadelphia gold and silver index added 1.05%. Gold ETFs bought 40kozs overnight. In todays trading, Gold is testing the $1270 resistance as the elevated $10-11 SGE premium prompts some buying out of China, though price action is expected to be relatively subdued ahead of the FOMC rates announcement in the US. The yellow metal is at $1268.50 as I write. Silver is grinding higher as the day wears on, the grey metal sitting at the days high of $16.92 as I write. PGMs have been quiet, with very little price action to speak of.

 

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 7 June 2017

MARKETS/MACRO: U.S. stocks opened lower on Tuesday as investors turned risk averse ahead of the British elections and former FBI Director James Comey's much anticipated testimony before Congress later this week. The Dow Jones Industrial Average fell -47.81 points, or -0.23%, to 21,136.23, the S&P500 declined -6.77 points, or -0.28%, to 2,429.33 and the Nasdaq slumped -20.626 points, or -0.33%, to 6,275.058. Energy (+1.20%) and Materials (+0.12%) were the only sectors to close in the black, while Consumer Discretionary (-0.83%) and Industrials (-0.63%) led the decline. European equities extended their recent slump on Tuesday, with healthcare stocks particularly weak, as a diplomatic spat in the Middle East weakened appetite for risky assets across the board. The FTSE Euro First 300 Index dipped -9.51 points, or -0.62% to 1,530.49 and the Euro Stoxx 600 retreated -2.64 points, or -0.67% to 389.40. Regionally the DAX crumpled -1.04%, CAC40 slumped -0.73% and the FTSE100 held fairly firm at -0.01%. Crude oil prices rose slightly on a combination of rising expectation of large draw down in inventories and heightened geopolitical risks. Kuwait’s Oil Minister said that Qatar is committed to the production cut agreement, despite diplomatic ties between partners Saudi Arabia being cut earlier this week. This eased concerns that this crisis would result in the compliance rate with the supply cuts falling. A Bloomberg survey also showed that investors are expecting a relatively large draw down in US inventories of around 3.2 million barrels. The price gain was also tempered by an EIA report that forecast US crude oil supply would rise to 9.33mb/d in 2017, while its estimate for 2018 remained at 10.01mb/d. The biggest movers for the day were sovereign bonds, with flattening pressure across curves. In core European countries, 10y yields declined 4-6bps, while the US 10-year yield fell 4bps to 2.14%. Some of these gains could also be attributed to market talk that China was prepared to buy more US treasuries under the right circumstances, especially as the yuan stabilises. Similarly, the upcoming political and policy calendar may have prompted some paring of risk.

On the data front, the U.S. Labour Department's monthly Job Openings and Labour Turnover Survey (JOLTS) suggested a recent moderation in job growth could be the result of a skills mismatch rather than easing demand for labour. Job openings increased +259k in April to a seasonally adjusted 6.044 million (5.75 million expected) in April, the highest since the government started tracking the series in 2000. "These data underscore the difficulty in hiring new workers, which we think is increasingly likely to be a factor restraining payroll growth going forward," said one chief economist.

PRECIOUS: Gold had a firm day Tuesday, kicked off in Asia by an aggressive sell-off in USDJPY. USDJPY opened around 110.45, close to the previous days lows and continued to trudge lower eventually tripping stops through 110 and continuing lower into NYK to trade as low as 109.23. USD in general remained fairly weak against most currencies over the day which continued to keep the yellow metal buoyant throughout the session, touching a cash high in NYK of $1296 and ultimately closing a few dollars off this. The yellow metal flat-lined up until the SGE open in Asia, upon which there was very little selling seen, a stark contrast to recent sessions. This drew out some technical based demand on Comex, aided of course by the swooning USD. The metal first shot to $1285 where some decent supply from private and macro names initially capped proceedings. When the SGE reopened for the Asia PM session, there was some evident buying from them this time round and spot gold was dragged up towards $1290. Throughout London and NYK it continued a more volatile rise, traversing between $1291-95 a few times into the close. A test of $1300 seems almost inevitable from here, although there does appear to be a bit of open interest on Comex at this level (~9k lots of July 1300 and ~6k lots of Aug 1300), which should make it a somewhat sticky price level. A lot will be riding on the political outcomes of the British election Thursday and Comey's Congressional testimony, which threatens to damage Trump administration and the ECB over the next 48 hours. Next week we also have the FOMC, with a rate rise ~90% priced in. If the Fed holds on this, a correction in the precious - particularly gold and silver - could be sharp and severe. For now we see the metal consolidating around $1280-1300, leading into these risk events.

ASIA TODAY: It was a much calmer day for the metals today, with investors awaiting the ECB, Britain's election and Comey's testimony. Gold opened in Asia where we left off at $1294.50, with some very modest profit taking from fast money type traders suppressing the price a dollar or so in early trade. The SGE opened to little interest with exceptionally light two-trade seen through the exchange. Following yesterday's weak session, USDJPY showed some resilience throughout the day, gradually clawing back some ground to above 109.60 after opening around 109.30. Spot gold slowly drifted lower over the afternoon managing to hold above $1291. Silver was equally dull, shaking off a few longs over the morning but holding above $17.65. In other markets equities were mixed, the Shanghai Composite leading the charge +1.1%, Nikkei +0.05%, ASX200 flat and Hang Seng -0.25%. On the data front Australian Q1 GDP came in line with expectations, growing by +0.3% QoQ (+0.3% expected), while yoy growth slowed to +1.7% YoY from 2.4% YoY (+1.6% expected). While it was in line with Bloomberg polls, it was viewed as an upwards surprise for the market after yesterday's very weak Net Exports reading. As expected, net exports and dwelling investment detracted from growth, but was offset by strong contributions from inventories. AUD jumped 30 pips higher to 0.7540, through the 200 dma at 0.7530 and continues to hold above this as I write.

 

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 19 Jun 2017

MACRO: Housing starts in the U.S. declined for the third consecutive month during May, falling -5.5% MoM (exp: +4.1%) to follow a downwardly revised -2.8% in April (prev: -2.6%). The May print saw starts at a seasonally adjusted 1.09 million, the lowest level since September 2016, while on an annualised basis starts dipped -2.4% YoY. Building Permits sunk -4.9% MoM (exp: +1.7%) to the lowest level since April 2016. Consumer Sentiment (provisional) in the U.S. slipped during June to the lowest level since the November presidential election. The University of Michigan Sentiment gauge declined to 94.5 (exp: 97.0) from 97.1 previously, with broad-based declines reported to see Current Conditions fall from 111.7 to 109.6, while Expectations dropped to 84.7 from 87.7. Equity markets in the U.S. closed generally higher on Friday, however tech stocks continued to see weakness to drag the Nasdaq lower for the second consecutive week. The DJIA tacked on +0.11% to end at a fresh record close of 21,384.28 points, supported higher by a rebound to crude prices. The S&P inched just +0.03% higher to 2,433.15 points as energy (+1.72%) ripped higher to offset declines to consumer staples (-0.99%) as whole foods (+29.1%) competitors were sold following the announced merger plans with Amazon. Over the week the DJIA added +0.5%, the S&P 500 was generally unchanged, while the Nasdaq sunk -1% after shedding -0.22% on Friday. Crude prices pushed higher on Friday, however were unable to move into positive territory on a weekly basis as benchmarks booked their fourth consecutive weekly declines and the longest losing streak since August 2015 for WTI. Data released by Baker Hughes on Friday showed active oil rigs in the U.S. increased for the 22nd consecutive session, adding 6 rigs to 747. Oil prices pulled back modestly from the session high print following the data, however held onto gains to see WTI settle +0.6% higher to USD $44.74 per barrel, while Brent jumped +1% to USD $47.37 per barrel. On a weekly basis WTI shed -2.4% and Brent ended -1.6% higher. Markets in Europe pushed higher on Friday, however saw gains tempered somewhat following the Amazon-Whole Foods announcement. The Stoxx Europe 600 added +0.66%, however slipped -0.5% lower for the week, while the German Dax ended the session +0.5% higher. In the U.K. the FTSE 100 snapped a 4-session losing streak to end +0.6% higher as resources stocks (particularly oil and gas) posted strong gains.

PRECIOUS: Gold traded in a relatively subdued manner on Friday, teetering around the USD $1,250 support, however seeing solid interest around the figure even amid a recovering greenback. Early Asian offers weighed upon the metal during Chinese trade, quickly breaking below USD $1,255 to print a USD $1,252 session low before European names provided support for a leg higher. Multiple tests toward USD $1,260 were thwarted during both European and U.S. hours to restrict top-side moves, seeing gold weighed down by a bid USD and end the session modestly lower. ETF holdings took a modest hit on Friday, while net managed money positioning sunk due to decreased short positioning. Interestingly considering the USD $30 move proceeding the U.S. CPI print last week, gold vols have tightened to see 1m at an all-time low around the mid-low 8's. Asian hours on Monday saw gold trade with a modest offered bias, uncoupling from USD flows to once again test toward support around USD $1,250 in light-moderate volumes. Regional physical names were active either side of USD $1,250 to keep the price action buoyant above the support throughout the session, however moves higher were quickly met with offers to keep the metal within a narrow range leading into European trade. Support around USD $1,250 remains the key for short term price action and we continue to see interest around this level amid geopolitical uncertainty. Silver was dragged lower with gold during Asian trade today following the weakness in New York on Friday, testing support around USD $16.60, before unconvincingly inching higher late in trade. The grey metal continues to to search for support after declining nearly -6% in less than two weeks, from a technical perspective testing toward a downward trend line around USD $16.50 that extends from the early Jul 2016 high of USD $21.13. There are no major data releases scheduled for today.

 

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 13 Jun 2017

MACRO: Equity markets in the U.S. eased lower on Monday in above average volumes, weighed down by further weakness to tech stocks, while a positive session for oil futures helped to temper the declines. The tech-laden Nasdaq Composite was the hardest hit, sliding -0.52% to end the session at 6,175.465 points, however recovering from an early session low of 6,110.665 points. The DJIA closed -0.17% lower at 21,235.67 points as Apple (-2.39%) and McDonald's (-1.99%) weighed upon the bourse, while weakness to technology (-0.81%) and materials (-0.53%) saw the S&P 500 to a -0.10% decline. With focus turning to a number of supply reports this week and Saudi Arabia seeking to reassure the market that supply cuts are in fact reducing the current global glut, oil futures continued to recover on Monday from last weeks declines. WTI added around +0.6% to settle above USD $46 per barrel, while Brent crude tacked on just over +0.3% to USD $48.29 per barrel. An EIA report noting an expected increase in U.S. shale production of 127,000 barrels per day saw WTI in particular pare earlier session gains into the close. Treasuries edged lower on Monday as yields once again increased leading into the upcoming FOMC meeting. The two-year note added around 2.1bps to 1.359%, while the 10-year increased 1.4bps to 2.215%. With an interest rate increase at this Wednesday's FOMC meeting effectively priced in, participants will shift focus to whether we will see a further hike before the end of the year, with the probability of such event sitting below 50% according to the latest CME data. Ongoing political uncertainty weighed upon equities in the U.K. on Monday, seeing the FTSE 100 to a -0.21% decline even amid a weaker sterling, while the more domestic focused FTSE 250 shed -0.42%. In Europe, regional bourse's suffered the worst single session declines in nearly a month as technology shares traded softer. The Stoxx Europe 600 fell -0.97% to book its worst decline since May 17 as the bourse's technology index collapsed -3.61%, the German Dax sunk -0.98% as Apple's stock on the exchange fell -4.31%, while the French CAC ended -1.12% lower.

PRECIOUS: A quiet session for gold on Monday, testing toward USD $1,270, however unable to make meaningful headway through the figure and ultimately drifting lower in New York. Following a relatively muted Asian session, the yellow metal traded with a mild bid tone once Europe opened, benefitting from a softening USD to briefly edge through USD $1,270. Interest was however short lived once New York entered, seeing the USD regain the ascendancy against majors and in doing so push gold to a USD $1,263.30 low and close in negative territory for the fourth consecutive session. Asian trade today was a relatively subdued affair, and aside from a brief test underneath the overnight low gold held a narrow range throughout the session, generally oscillating either side of USD $1,265. Initial support comes in around USD $1,260 (50 DMA) and we have seen interest sub USD $1,265 in recent days restrict further declines. Looking ahead to the FOMC on Wednesday the key support for the metal will be USD $1,250, while should the statement and proceeding press conference take on a dovish skew we will look for a break above USD $1,275 for a renewed push toward USD $1,300. Silver once again tracked lower on Monday, breaking to a USD $16.90 low on a stop loss run through the USD $17 support level. There was little respite for the grey metal during Asian hours today, under pressure from the Chinese open and breaking below the overnight low print into London trade. Platinum pushed toward USD $950 in Asian trade today, however ran into offers around the resistance, while palladium held steadfast around USD $900, with participants still able to drive a truck through the spread. Key data releases today are U.K. CPI / RPI / PPI, U.K. Retail Price Index, German ZEW Survey Results 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 : Tuesday 6 Jun 2017

MACRO: Nonfarm Productivity in the U.S. improved to a flat read during Q1 according to the latest Labor Department data released on Monday. The print follows an initial -0.6% estimate, while unit labor costs were revised lower to +2.2% (exp: +2.4%) over the same period from an initial estimate of +3.0%. The Institute for Supply Management reported its non-manufacturing activity index pulled back to 56.9 (exp: 57.1) during May, to follow an April print of 57.5. New orders lagged, declining 5.5 points to 57.7, while employment added 6.4 points to 57.8. Markit reported on Monday that U.S. business activity growth within the services sector continued to expand during May. The Markit Services PMI for May (final read) eased marginally to 53.6 from an initially estimated 54.0, however improved on April's final read of 53.1 to book the largest rise in activity since February. Chris Williamson, Chief Business Economist at IHS Markit noted with the release; "Although service sector business activity picked up in May, the PMI surveys for manufacturing and services collectively indicate only a modest pace of economic growth so far in the second quarter." U.S. Factory Orders declined for the first time in five months during April, sliding -0.2% (exp: -0.2%) from an upwardly revised +1.0% gain the month prior (prev: +0.2%). Durable goods orders also softened to post a -0.8% decline (exp: -0.6%) from -0.7% previously, while ex-transportation goods declined -0.5% (exp: -0.2%) from -0.4% previously. Shipments of Capital goods inched up +0.1%, while core capital goods, which are used in the calculation of GDP also added +0.1%. Equity markets in the U.S. eased back from recent record high closes on Monday as investors considered recent geopolitical developments including the London terrorist attacks and the upcoming U.K. Election. The DJIA eased -0.1% to close at 21,184.04 points after paring early session gains, while utilities (-0.48%) and materials (-0.46%) led seven of eleven sectors lower to see the S&P 500 end -0.12% off the pace at 2,436.10 points. Soft trade among tech stocks saw the Nasdaq to a -0.16% decline, ending the session at 6,295.684 points. Oil prices pared Asian gains on Monday on the back of heightened uncertainty in the Middle East following news that Saudi Arabia, Bahrain, Egypt and the UAE cut ties with Qatar. WTI sunk around -0.6% to settle at USD $47.40 per barrel, while Brent Crude fell around -1% to end the session at close to USD $49.50 per barrel. Equities in the U.K. (-0.29%) closed in negative territory on Monday as the pound posted gains following fresh polls suggesting the Tories enjoy an eleven point lead over Labour Party.

PRECIOUS: Gold held firm to consolidate the NFP driven Friday gains on Monday, pushing above USD $1,280 on numerous occasions, however unable to hold above the figure into the close. The yellow metal held a relatively narrow range throughout Asian / European hours, before breaking to a session high of USD $1,283.25 in New York. Late session offers blotted the copy paper to have bullion underneath USD $1,280 into the close, ending generally flat for the session. ETF holdings firmed modestly on Monday, seeing just over 100k oz of inflows. Dollar weakness (in particular USD/JPY) drove gold higher during Asian hours today, surging higher around the Shanghai open following muted early session interest. Strong two-way flows through Comex (50k lots for the session) saw bullion push through Monday's high with relative ease, testing a break through USD $1,285, however weighed down by a lack of interest during the Chinese lunch break. A break through USD $1,285 on the back of further USD/JPY declines leading into European hours provided the impetus for a renewed push higher, with participants pushing the yellow metal to a USD $1,289.40 high and well within sight of the 2017 high watermark. Generally light positioning and numerous upcoming geopolitical events should continue to underpin demand for the metal, with targets extending to the 2017 high around USD $1,295 and the psychological level of USD $1,300 above this. Silver continued to push higher in Asia today, consolidating above USD $17.60 to make further headway toward USD $18. Platinum caught a late Asian session bid to test Monday's New York high of USD $960 into European hours, while palladium recovered from initial weakness to test USD $850 late. Data releases tonight include Eurozone Retail Sales and the U.S. JOLTS report.

 

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 16 Jun 2017

MACRO: Initial Jobless Claims in the U.S. fell by more than expected during the week ended June 10, declining 8,000 to a seasonally adjusted 237,000 (exp: 241,000). The weekly print saw the 4-week moving average tick 1,000 higher to 243,000, while Continuing Claims edged 6,000 higher to 1.935 million (exp: 1.920 million) during the week ended June 3. Industrial Production in the U.S. was unchanged during May, failing to meet expectations of a +0.2% increase to following an upwardly revised +1.1% gain in April (prev: +1.0%). Manufacturing was the main drag on the headline print, declining -0.4% after touching a post recession high during April. Capacity utilisation eased -0.1% to 76.6% and continues to stand well below the long-run average of 79.9%. The National Association of Home Builders Housing Market Index showed weakness in the market during June. The NAHB index dipped to 67 (exp: 70) from a downwardly revised 69 in May (prev: 70), with the June softness predominately a result of declines in the West. The Philadelphia Fed Business Outlook pulled back from May's stunning 38.8 read to print 27.6 in June (exp: 24.9), while the Empire State Manufacturing Index rocketed to the highest level since 2014 to print 19.8 (exp: 5.0) from -1.0 previously. Leading the Empire state print was a rebound in the new orders index to 18.1 from -4.4 previously. Equity markets in the U.S. eased on Thursday following the hawkish FOMC comments the day prior, weighed down by declines to technology and energy shares. The DJIA turned higher late in trade to limit declines to -0.07%, ending the session at 21,359.90 points as Nike (-3.22%) weighed upon the bourse following announced job cuts. Softness across materials (-0.90%) and energy (-0.68%) led the S&P 500 -0.22% lower to 2,432.46, while the Nadaq recovered from intra-day lows, however ended the session down -0.47%. Oil futures eased further on Thursday to end the session with modest declines, suffering from an appreciating dollar and higher gasoline prices following a smaller than expected rise in gasoline supplies during the week ended June 9. WTI posed a -0.6% decline to settle at USD $44.46 per barrel, closing at the lowest level since mid November, while Brent crude dipped -0.2% to end the session just underneath USD $47 per barrel. In London on Thursday as widely expected the BOE kept interest rates on hold at 0.25%, however the main talking point out of the decision was the dissent of 3 monetary policy committee members to see the vote for no change at 5-3. News of the dissent sent GBP soaring toward 1.28 against the greenback, weighing upon equities as the FTSE 100 ended -0.74% lower to book the largest single-session decline in nearly a month. Equity markets across Europe closed lower on Thursday following the rates decision in the U.S., seeing the Stoxx Europe 600 down -0.39% to close at its lowest level since April 21, while the German Dax ended the session -0.89% softer.


PRECIOUS: The precious complex continued to soften on Thursday following the hawkish FOMC decision / commentary, weighed down by a firming USD to see gold close at the lowest level in 3-weeks. Interest out of Asia provided some respite for the metal following the post-FOMC declines in New York, holding above the 50 DMA around USD $1,261 to push above USD $1,266 briefly before coming under pressure again as London opened for business. A break of the USD $1,261 support saw gold to USD $1,253 leading into U.S. hours, while early New York pricing marked the session low of USD $1,250.90, before recovering marginally in afternoon trade. ETF's recorded further outflows overnight, while vols softened particularly at the front end to see 1m toward 9. Gold traded in a relatively subdued fashion during Asian hours on Friday, continuing to see solid interest toward USD $1,250, in particular from physical names. Interest out of Shanghai saw the on-shore premium hold around USD $9, while USD/CNH flows on the back of stop loss buying saw USD/CNH over 3 big figures higher today as specs exited short positions that were instigated following the change in fixing methodology. We saw renewed interest in the metal late in trade once China returned from lunch and as Europe began to open, edging toward USD $1,255 to print the session high. We do continue to see some downside risks to the metal as the market contemplates the Fed comments and recent U.S. data releases, however it's difficult to see the metal extending declines far below USD $1,240 - $1,250 considering the recent price action and the geopolitical climate. Silver lost touch with the USD $17 handle on Thursday to continue its declines from the USD $17.74 high printed only last week and hand back a further -1.6%. Asian interest in the grey metal saw a mild bid bias, albeit within a narrow range, pushing toward USD $16.80 late in the session. After recovering late in trade on Thursday, palladium spent Asian hours today consolidating the New York gains, as the EFP comes back underneath USD -$10 with backwardation continuing to flatten. In other regional news today the BOJ maintained the 10-year yield target at about 0.00%, and the deposit rate steady at -0.1%. Data releases today include Eurozone CPI, U.S. Housing Starts and the University of Michigan Consumer Sentiment 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 : Monday 12 June 2017

MACRO: Theresa May has been labelled a 'Dead woman walking' by former finance minister George Osborne as she tries to form an 'alliance' with the DUP. Although not a formal coalition, the government will seek assurances from the DUP on issues such as the budget, defence and brexit. Meanwhile in France, Emmanuel Macron's centrist party looks likely to take an overwhelming majority in parliament following the first round of voting on the weekend. Macron's En Marche and ally MoDem have secured 32.32% of votes in the first round, while Les Républicains and its allies received the second most on 21.56%. Wholesale Inventories in the U.S. fell more than initially estimated during April, decreasing at a -0.5% pace (exp: -0.3%) to book the largest decline in more than 12-months. Petroleum inventories led the declines to slide -5.0%, the largest fall since December 2015, while paper inventories fell -1.8% to mark the categories largest drop since January 2013. Sales at wholesalers pulled back -0.4% (exp: +0.2%) during April to follow a -0.2% fall in March, as machinery sales dipped -0.8%, while electrical goods (+0.7%) and auto sales (+1.3%) posted increases. Equity markets in the U.S. closed mixed on Friday, with technology shares seeing late session weakness to push the Nasdaq to its largest single session decline in 3-weeks. The DJIA closed +0.42% higher at 21,271.97 points to book a fresh record close and outperform on a weekly basis, gaining +0.3% over the period. The S&P 500 eased just -0.08% as heavy trade to technology (-2.74%) offset positive performances from energy (+2.48%) and financials (+1.93%) to see the bourse hand back -0.3% over the week. The Nasdaq collapsed -1.80% to end in negative territory over the week, with profit taking following the recent surge higher weighing upon heavy hitters such as Apple (-3.88%) - posting its largest single session decline since January 2016. Oil futures firmed on Friday, however it wasn't enough to drag prices into positive territory on a weekly basis, with benchmark's registering the third consecutive week of declines. WTI added just over +0.4% to settle at USD $45.83 per barrel, however slumped -3.8% over the week on the back of increased U.S. crude supplies. In London, Brent crude gained +0.6% to end the session above USD $48 per barrel, while on a weekly basis posted a -3.6% decline. U.S. treasury yields edged higher on Friday as investor's turned their focus to the upcoming FOMC meeting. The two-year note added around 1.6bps to 1.338%, taking the weekly gain to 4.9bps to mark the largest weekly increase since April 28. After falling to the lowest level in almost seven months earlier in the week, the 10-year yield recovered to add 0.5bps on Friday and see the weekly increase to 4.1bps. Expectations of a 'softer brexit' following the outcome of the U.K. general election supported European equity markets higher on Friday. The Stoxx Europe 600 ended the session +0.32% higher, while the German Dax jumped +0.8% and the French CAC gained +0.67%. In the U.K. a weaker sterling helped support the FTSE 100 higher, seeing the bourse gain +1.04%, while the more domestically focused FTSE 250 edged +0.1% higher.

PRECIOUS: Gold saw some of it's recent risk premium wiped away on Friday, sliding below the USD $1,270 support as the greenback turned higher, in particular against the sterling. Asian participants saw an early bid tone as the U.K. election results started to filter through, however offers soon weighed upon the metal around the Chinese open, losing touch with the USD $1,280 handle. Gold was able to hold above USD $1,270 throughout the Asian afternoon and during the majority of European trade, however saw further weakness in New York to turn sharply lower on a stop loss run through the support and touch a USD $1,264.25 session low. Late session bargain hunters took bullion briefly through USD $1,270, however the metal wasn't able to hold above the figure into the close, ending around -1% lower on the day. Asia opened with a modest bid tone on Monday, however couldn't find enough interest to make headway through USD $1,270 and spent the remainder session in a narrow range to hold around USD $1,266 - $1,268 throughout the afternoon. Initial support for the metal comes in broadly around USD $1,260 - $1,265, while a close above resistance at USD $1,270 will be the key for a move back toward USD $1,300. Silver disappointed on Friday (-1.2%), continuing to slip lower following Thursday's collapse to lose sight of USD $17.50 and end toward the session low print. The grey metal saw further softness during Asian trade on Monday, sliding below Friday's low print in New York and looking likely to test toward USD $17 leading into the upcoming FOMC meeting. The big mover on Friday was palladium, surging through USD $900 to its highest level since 2001. After years of debate over physical supply, it finally looks as though the market has begun to adjust, while increased investor demand has added a further bullish tone to the price action. The white meal continued to see interest during Asian trade on Monday, however a lack of liquidity saw spreads push out beyond USD $10 at times, potentially stymying some fresh positioning. With fundamentals remaining in-tact, expectations are that we are likely to see the metal push higher in the near-mid term. Expectations are that the U.S. Federal Reserve will raise interest rates this week (Wednesday June 14), with focus turning to the FOMC's expected number/pace of increases and underlying view on the U.S. economy. Although the market has priced in a near 95% probability of a hike, we are likely to see volatility around the precious complex leading into the decision as well as following the statement and media conference once we have an idea of the projected interest rate path and the committee's opinion of recent soft data. There are no major data releases scheduled for today, rather we will watch developments out of the U.K. with the current hung parliament and any further details surrounding the Comey-Trump ongoing saga.

 

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 5 Jun 2017

MACRO: Job data out of the U.S. on Friday came in well below expectations to see nonfarm payrolls increase just 138k (exp: 182k) during May. There were further soft data in revisions to previous months as April's 211k was cut to 174k, while March's paltry 79k additions was downwardly revised to a meagre 50k. The -66k of revisions over the past two months sees the 3-month average fall to just 121k, while the 2017 monthly average currently stands at 162k compared to an average monthly gain of 187k during 2016. For the month of May, professional and business services led the way to add 38k new positions, restaurants and bars increased 30k, healthcare gained 24k payrolls, mining grew by 7k and government lagged to see a 9k decline. The unemployment rate eased to 4.3% (exp: 4.4%) from 4.4% previously as the participation rate pulled back two tenths of a percent to 62.7%. Average hourly earnings held firm, however were unable to meet analysts expectations, printing +2.5% YoY (exp: +2.6%) from +2.5% previously, while the average work week was unchanged at 34.4 hours. U.S. trade balance data released on Friday saw the Nation's deficit widen to USD $47.6 billion (exp: $46.1b) from USD $45.3 billion in March. Exports dropped -0.3% to USD $191 billion, predominately a result of declining autos, while Imports pushed higher to USD $238.6 billion. Equities in the U.S. surged higher on Friday following the softer than expected jobs data, seeing the Dow Jones Industrial Average, the S&P 500 and the Nasdaq Composite all end at record high closing levels. As investors considered whether the Federal Reserve may now raise rates only once more in 2017, technology shares were the main beneficiary, gaining +1.04% to support the S&P 500 +0.37% higher to a record close of 2,439.07 points. The DJIA added +0.29% to end the session at a record close of 21,206.29, while the Nasdaq outperformed to post a +0.94% gain and end at a record close of 6,305.796 points. Over the week the S&P 500 added +0.9%, the DJIA gained +0.6% and the Nasdaq surged +1.5%. Oil prices recovered somewhat from European declines on Friday, however still managed to end at the lowest level in three weeks as investor's become increasingly concerned over U.S. production levels following the Nation's withdrawal from the Paris Climate Accord. WTI settled underneath USD $48 per barrel to hand back around -1.5%, a weekly decline of -4.3%. The Greenback traded under pressure on Friday, weighed down by the softer jobs data to touch multi-month lows against majors. The weakness saw the DXY sink around -0.5% to its lowest level since November last year. European markets inched higher on Friday after paring earlier gains following the U.S. jobs report. The Stoxx Europe 600 added +0.2% after trading +0.8% higher mid-session, while the German Dax (+1.25%) outperformed on the back of strong performances to auto shares as new German car registrations spiked +13% in May. In the U.K. the FTSE 100 pulled back from an all-time intraday high to end with a +0.05% gain as the sterling recovered ground following the U.S. jobs report.

PRECIOUS: Gold futures ripped higher on Friday following the U.S. payrolls release, surging to a 5-week high as the USD collapsed in New York. After holding USD $1,260 into the data release, bullion made light work of resistance around USD $1,270, testing USD $1,280 into the close to end the session on the highs and post a +1.5% gain. Although a June interest rate increase is still broadly expected (approx 90% probability), focus has turned to the remainder of 2017, with confidence in the U.S. economy taking a hit following the latest jobs release. We are seeing continued interest in the yellow metal from money managers, with the latest CFTC data reporting an increase in net longs of close to 14k contracts, while ETF holdings increased modestly on Friday to see +60k ounces of inflows. Gold initially pushed higher during Asian trade on Monday following the tragic terrorist attack in London over the weekend, edging to a USD $1,281.85 session high before tailing off modestly in afternoon pricing. Demand from China was relatively modest as the on-shore premium held around USD $7 over London gold, while flows through Comex were robust to see close to 40k lots pass through the exchange leading into European hours. The soft greenback and geopolitical concerns including Saudi Arabia, Bahrain, Egypt and the UAE cutting ties with Qatar today is likely to underpin gold's safehaven demand over the coming days, while uncertainty surrounding this weeks' U.K. election can not to be underestimated. Expect to see interest restrict declines below USD $1,270, while resistance comes in at the 2017 high around USD $1,295. Silver continued to edge higher during Asian trade on Monday to follow Friday's stunning +2% return, however saw modest offers restrict a move above New York's Friday high print. The metal looks to be steadily building toward a test of USD $18, currently sitting at a near 6-week high as CFTC data reports further bullish bets on the metal (net longs most bullish in a month). Platinum consolidated its +2.4% gain on Friday during Asian trade today, while palladium made headway through Friday's high in late afternoon trade today. Data out of the U.S. today includes Markit Services / Composite PMI prints, ISM Non-Manufacturing, Factory Orders, Durable Goods Orders and Capital 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 : Thursday 15 Jun 2017

MARKETS/MACRO: It was all about the US overnight with a slew of economic releases causing some sizeable volatility across financial markets. While the play-book was supposed to be a case of “all quiet until the FOMC rate decision”, the fireworks began early, with the release of some much softer U.S. CPI figures. U.S. equities closed mixed after the Federal Reserve raised interest rates (+0.25%) as expected for a second time this year, with the soft CPI read and a -3.7% drop in WTI crude futures weighing further on the market. The Dow Jones industrial average rose +46.09 points, or +0.22%, to a record close of 21,374.56, the S&P500 declined -2.43 points, or -0.1%, to 2,437.92 and the Nasdaq Composite the worst performer, finishing down -25.477 points, or -0.41%, at 6,194.892. Consumer staples (+0.6%) and utilities (+0.59%) were the leaders while materials (-1.06%) and energy (-1.83%) were the notable laggards. European Indices drifted lower overnight as political uncertainty in the UK continued to weigh on sentiment and financials across Europe softened on anxiety US economic data was signalling a mixed growth outlook. The Euro First 300 index dipped -5.38 points, or -0.35% to 1,522.29 and the Euro Stoxx 600 shrugged off -1.17 points, or -0.30% to 387.58. Regionally the DAX outperformed up +0.32%, the FTSE100 was down -.35% as was the CAC40 -0.35%. Crude oil prices fell after a weak set of inventory data in the US. The weekly EIA report showed that crude oil inventories fell by 1.66 million barrels last week. This was slightly better than expected, following on from the API numbers yesterday which showed an increase in inventories. However, the market was spooked by the increase in gasoline inventories (+2.11 million barrels). Adding to the pessimism was a report by the IEA that said the market will be largely balanced as output from non-OPEC producers will more than meet demand in 2018. Lack luster retails sales and the broadly based weak inflation print - now a third in a row - made a dent in the dollar. Market participants subsequently adjusted expectations for a stronger wording around the weak inflation from the Fed or even late revisions to forecasts. This failed to materialise as the Fed continued to describe the economy as “roughly balanced,” and Yellen further down-played inflation in the press conference. AUDUSD outperformed trading through 0.7600 and holding most of the gains - last 0.7590.

The Fed raised rates by 25 basis points overnight as was widely expected, and kept is economic projections largely unchanged. The central bank noted that household spending had "picked up in recent months", an upgrade from the May statement. The Fed also provided more details on how it plans to reduce its massive $4.5 trillion balance sheet. However, the Fed now believes inflation will fall well short of its target this year. The statement noted that inflation in the next 12 months "is expected to remain somewhat below 2 percent in the near term" but to stabilise. For now, the market has taken a dovish spin on the Fed and Yellen's accompanying statement, but at the end of the day it all comes down to the data. The lowlight overnight was indeed the CPI, which saw the headline MoM figure for May decline -0.1% (+0.0% expected) and core MoM figure gain only +0.1% (+0.2% expected). This translated to an annual rise in the core CPI of +1.7%, well below the prior read of +1.9% and expectation of the same. Yellen was at pains to point out in her testimony that the Fed felt this was transitory and is not reading too much into the recent weakness. US retail sales were also below consensus, although the details were stronger than the headline series and continue to suggest some acceleration of consumption in Q2. The Commerce Department said retail sales fell -0.3% in May (0.00% expected), amid declining purchases of motor vehicles and discretionary spending after a +0.4% increase a month earlier. May's decline was the largest since January 2016. Excluding automobiles, gasoline, building materials and food services, retail sales were unchanged last month after an upwardly revised +0.6% rise in April.

PRECIOUS: The precious complex had a wild day yesterday, in line with volatile treasury and FX markets, the yellow metal covering a $25 range in NYK alone. Gold opened around $1266.50 yesterday in Asia and it was clear from the onset that there was still some macro length to be liquidated ahead of the FOMC risk event. The volumes were light however and were offset by retail buying throughout the morning session - the spot price happily veering sideways between $1266.50-1268 into the SGE open. From there the flows remained mixed into the afternoon in what were generally quiet conditions, gold edging up towards $1270, with a majority of traders happy to sit back and see what would unfold after the FOMC. After consolidating during European hours and ever so slowly meandering back towards $1265, things began to liven up in NYK. Once the CPI miss was announced gold ripped some $14 higher, falling just short of $1280 and then maintained a $1275-80 range into the FOMC. On the release of the decision, Gold traded ~8500 lots in one minute and spiked up to $1280.75, but as the market absorbed the wording it fell rather sharply down to $1257.70, before stabilising just above $1260. For a session with such a wide range volumes remained very light, apart from seeing some physical buying at the lows post the FOMC. Support now sits around $1257-60 and given the intensity of the sell-off this week, we feel the market will take pause around this level.

ASIA TODAY: Steady buying across gold and silver was seen this morning as Asian markets came on line. After opening at $1260, the first noticeable buyers were Japanese banks pushing the price a few dollars higher just after the Tocom open. China were also on the bid an hour later, with the onshore premium on the SGE a few dollars higher from yesterday (~$10 over spot). This demand extended spot gold and silver's morning advance to push above $1265 and $17.00 respectively. Currencies were a lot calmer than yesterday with most of the majors hovering around their closing levels from the previous day. AUD was the stand-out however, surging on the back of strong employment data. Employment growth for May was solid, coming in at +42K jobs (+10k expected), which was all-round positive for AUD. The rise marks the third consecutive month of strong jobs growth, importantly driven by full-time jobs, as well as a drop in the unemployment rate to 5.5% (lowest since 2013) despite a small rise in participation. On top of this April was revised higher to +46.1k (+37.4k prior). AUDUSD jumped ~40 pips through 0.7600 after the release, although failed to breach the o/n high at 0.7636. The pair peaked at 0.7632 before consolidating into the afternoon between 0.7600-0.7620. In other markets equities were softer across the board the Nikkei currently -0.4$, Hang Seng -1.05%, Shanghai Composite -0.15% and ASX200 -1.15%. The USD was fairly flat, with the exception of the AUD, crude is flat - WTI +0.05% at $44.68 - and silver currently leads the charge in the metals up +0.65%, while gold is +0.35%, platinum +0.2% and palladium +0.3%. On the data calendar today look out for the BoE rate decision, UK retail sales, French and Italian CPI and U.S Philly Fed Business outlook, Empire manufacturing and jobless claims.

 

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 8 Jun 2017

MACRO: Equity markets in the U.S. posted modest gains on Wednesday ahead of former FBI Director James Comey's Senate testimony, as financial shares outperformed to offset further energy declines. The S&P 500 added +0.16% to 2,433.14 points as eight of eleven components led by financials (+0.18%) saw the bourse higher, while the DJIA tacked on +0.18% to end the session at 21,173.69 points. The Nasdaq composite closed +0.36% higher at 6,297.38 points. Oil prices turned sharply lower on Wednesday, weighed down by the latest U.S. supply data released by the Energy Information Administration showing crude stockpiles increased for the first time in nine weeks. The EIA reported a 3.3 million barrel increase for the week ended June 2, to see WTI collapse almost -5% and settle at USD $45.72 per barrel, while Brent crude tanked around -4% to end just above USD $48 per barrel. Treasury yields popped higher on Wednesday following the release of a written statement by former FBI Director James Comey, seeing 10-year note pull add 3.3 bps to pull away from a seven month low. European stocks ended jittery trade on Wednesday with modest declines leading into Thursday's ECB meeting. The Stoxx Europe 600 closed in negative territory for the third consecutive session, easing -0.06% lower to end the session at 389.18 points, while the German Dax handed back -0.14% as factory orders for April collapsed -2.1% MoM (exp: -0.3%). Ahead of Thursday's general election the U.K. FTSE (-0.62%) traded heavily on Wednesday, touching a two-week low as the sterling found legs late in trade.

PRECIOUS: Gold edged modestly lower on Wednesday following recent multi-session gains, with participants on the offer late in the session following headlines surrounding former FBI Director James Comey's written statement release. The yellow metal made several attempts toward Tuesday's USD $1,296 high print, however was unable to test the figure, trading heavily into the close as U.S. treasury yields recovered from multi-month lows and the greenback edged higher in whippy trade. A brief stop loss run through USD $1,285 saw the session low of USD $1,282.80 printed, however the metal found reasonable support to claw back late these late session losses into the close and end with a modest -0.3% decline. Gold vols continued to creep higher, with 1m extending to around 11.2, while ETF inflows spiked on Wednesday, notably the SPDR increased by around 9 tonnes to mark the largest inflows in 7 weeks. Gold saw decent support during Asian trade on Thursday, however held a relatively narrow range as participants were reluctant to instigate fresh positioning with the ECB, U.K. general election and Comey's testimony all scheduled for today. Mild interest out of China at an onshore premium of around USD $8 over London gold saw the metal above USD $1,287, however once the far East exited for lunch offers wrestled back control to push bullion underneath USD $1,285 once again. Hawkish headlines out of Japan hit the wires in the afternoon; "BOJ is said to re-calibrate communications on future exit" to weigh upon USD/JPY and send gold higher on the back of the dollar weakness. The metal traded as high as USD $1,289.20 leading into European hours and is positioned well for a further move toward USD $1,300 should today's events throw up any surprises. Key levels to watch on the top side are USD $1,296 and USD $1,300, while support broadly sits around USD $1,277 - $1,282. Silver recovered during Asian hours today to test back toward USD $17.70 following the recent failed moves toward resistance at USD $17.75, while palladium repositioning overnight following its staggering recent run higher saw a -2.5% decline, with a modest recovery back above USD $840 in Asia today. A huge night of events tonight with the European Central Bank meeting, former FBI Director James Comey's Senate testimony and the U.K. headed to the polls.

 

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 2 Jun 2017

MARKETS/MACRO: President Donald Trump announced the US would withdraw from the Paris agreement to curb climate change, which he claims placed "draconian" financial burdens on the American people. The decision was widely criticised both globally and within United States. US equities were higher on stronger than expected jobs growth data as the 3 major bourses all closed in record territory. The Dow gained 135.53 points, or 0.65%, to 21,114.18, the S&P 500 added 18.26 points, or 0.8%, to 2,430.06, and the Nasdaq rose 48.31 points, or 0.8%, to 6,246.83. All sectors finished ahead with financials (+1.2%), healthcare (+1.2%) and materials (+1.1%) leading the way. European shares were higher, the EuroSTOXX shed 1.67 points, or 0.4%, to 391.66, the German DAX retreated 49.86 points, or 0.4%, to 12,664.92, whilst the UK FTSE added 23.82 points, or 0.3%, to 7,543.77. In currency markets, the US dollar index rose 0.28% to 97.198, the EUR traded down to 1.1205, while USD JPY traded up to 111.44. US treasury yields were higher, 2 year yields firmed 1.6 bps to 1.298% whilst 10 year yields rose 1.2 bps to 2.215%. In commodities news, Oil prices were lower despite further reduction in US crude inventories, Brent fell 0.7% to $50.40 while WTI shed 0.6% to $48.01. Base metals were mostly lower, with nickel (-1.5%) the biggest loser. In US economic data, payroll processor ADP reported that private payrolls rose 253k in May from a 174k increase in April, well exceeding economists expectations of a 180k increase. The Institute for Supply Management manufacturing index crept up to 54.9% in May from 54.8% in April. Of the sub-components of the index, new orders rose to 59.5% while prices dropped 8 points to 60.5%. The related Markit manufacturing PMI (final) fell to 52.7 in May from 52.8 in April, the smallest monthly increase in 8 months. Construction spending shrank 1.4% to $1.22 trillion in April following a revised 1.1% increase in March. Initial jobless claims rose 13k to a seasonally adjusted 248k in the week ending May 27. Continuing jobless claims fell by 9k to 1.92M. In Asia today, as I write the Nikkei sits at +1.76%, the Shanghai composite is at -0.36%, the Hang Seng at +0.42%, and the ASX S&P 200 finished at +0.87%. Tonight we have non-farm payrolls, unemployment rate, average hourly earnings, and trade deficit data out of the US.

PRECIOUS: A disappointing session for the precious in choppy NY trade. Gold slipped a few dollars on the Asian open, but with USD/CNY under 6.80 and the SGE premium around $8, Chinese buying saw the metal test $1270, though resting orders on COMEX capped the market. Golf drifted lower through Asian PM and London morning as the greenback gained momentum. The strong ADP employment data saw USD spike after NY open and gold dumped to the days low of $1261. A rally sparked by Trump's Paris withdrawal announcement saw the yellow metal climb back up towards the days highs, before finishing up at $1265. Silver was not able to pare all of it's early losses, the grey metal finishing in negative territory despite a strong rally in NY. Mixed fortunes for the PGM's, platinum closed around the lows while a strong rally saw palladium finish near the top. The Philadelphia gold and silver index lost 0.4%. SPR Gold Trust ETF holdings were unchanged overnight. In todays trading, Gold was on the offer early in Asia as USD/JPY firmed. Despite the elevated SGE premium at $13-14, the yellow metal saw little buying support out of China and moved to test the key support at $1260 a couple of times during the day. Gold is sitting near the lows at $1260.80 as I write. Silver has drifted steadily lower through the day, the grey metal is at $17.18 as I write. Not much price action from the PGM's, platinum and palladium have traded generally sideways through the session.

 

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