DAILY REPORT : Thursday 1 Jun 2017

MACRO: The U.S. Federal Reserve Beige Book released on Wednesday indicated that the economy continued to expand at a modest to moderate pace during the period of early April to late May. The report was however tempered somewhat relative to previous releases, with activity slowing in Boston and Chicago, while activity in New York flattened. Softer labour conditions are reportedly weighing upon economic growth in some regions, with Chicago in particular reporting a tight market and difficulty filling positions at any skill level. In the San Francisco region, growers noted that the tighter immigration stance of the Trump administration is creating "substantial labor supply shortages for low skilled workers,". Consumer spending showed little or no change across most districts and auto sales pulled back from last year's record highs. Manufacturing activity saw modest growth across most districts, while construction of new homes and non-residential structures also continued to grow at modest to moderate rates. The MNI Chicago Business Barometer jumped to a two-and-a-half year high during May, increasing to 59.4 (exp: 57.0) from 58.3 in April. The print was the highest since November 2014 as four of five components increased. Production continued to strengthen, adding 3.7% to 63.2, order backlogs pushed into positive territory following five months of declines, while new orders lagged, falling 4.5 points to 61.4. Pending home sales in the U.S. continued to lag during April, sliding -1.3% (exp: +0.5%) from a -0.9% decline in March. On a year-on-year basis sales declined -3.3% to mark the first annualised decline since December 2016 and the largest since June 2014. Contracts fell in the Northeast, Midwest and South, however surged +5.8% in the West. Equity markets in the U.S. ended trade modestly lower on Wednesday after recovering the majority of steep early session declines. Heavy trade to J.P. Morgan (-2.09%) and Goldman Sachs (-3.28%) weighed upon the DJIA to see the bourse -0.10% lower at the closing bell, while the S&P 500 handed back -0.05% as financials (-0.80%) and energy (-0.40%) led declines. Over the month the S&P 500 added +1.2%, the DJIA inched +0.3% higher, while the Nasdaq's -0.08% slide on Wednesday saw the monthly gain hold around +2.5%. Weakness across energy stocks came courtesy of soft trade to oil futures, falling sharply on Wednesday as investor's doubt production cuts will have any material effect on the supply / demand balance. WTI posted a -2.5% decline to take the monthly result to -2.1%, while Brent crude sunk -3% to see the monthly return to -3.4%. Treasury yields eased on the back of mixed U.S. economic data and month end re-balancing. The 10-year tield eased close to 1bps to sit at 2.21% and the two-year dipped around 0.8bps to just underneath 1.28%. Markets across Europe closed mixed on Wednesday following softer than expected inflation data out of the region. Eurozone inflation eased to +1.4% YoY during May (exp: +1.5%) to follow April's +1.9%, while core CPI eased to +0.9% YoY (exp: +1.0%) from +1.2% previously. Unemployment in the region unexpectedly declined during April, easing to 9.3% (exp: 9.4%) from 9.4% previously. The Stoxx Europe 600 booked its fifth consecutive session decline to hand back -0.13%, however the bourse was able to hang onto a +0.8% gain over the month of May. A softer Sterling provided support to equities in the U.K. on Wednesday as the bourse added +0.09%.

PRECIOUS: Further dollar weakness underpinned a strong session for gold to end the month of May, taking the metal to its highest level in 5-weeks before easing into the close. Soft Asian demand saw gold initially under pressure on Wednesday as China returned from their Dragon Boat Festival on the offer, however demand from the far East picked up in afternoon hours as USD/CNH collapsed from 6.8370 to around 6.7450, keeping the yellow metal buoyant above USD $1,260 into European hours. Weakness across equity markets in both Europe and the U.S. supported gold throughout the remainder of Wednesday's session, taking the metal to a USD $1,274.10 high in New York, before easing modesty into the close following the Fed beige book release, ending +0.8% higher for the session and generally flat over the month. The yellow metal saw mixed price action during Asian trade on Thursday, recovering from a mild early offered bias once China opened, however unable to make headway through offers above USD $1,270 to hold underneath the figure throughout the afternoon. Continued Geopolitical concerns and jitters across global equities are supporting the price action currently, however investor's are likely to hold off instigating fresh positioning until we are through U.S. jobs data on Thursday (ADP employment) and Friday (NFP). Resistance sits around USD $1,275, while support for the metal is broadly around USD $1,255 - $1,260. After pushing through USD $17.40 in New York late on Wednesday, silver struggled to garner support in Asia on Thursday. Moves toward USD $17.40 were met with heavy offers and the grey metal tested USD $17.30 in afternoon trade. Platinum eased back from $950 today following Wednesday's +1.1% gain, while palladium consolidated Wednesday's +1.8% gain to hold a narrow range in Asia today. Data releases tonight include U.K. House Prices, Markit Manufacturing PMI prints from Italy, France, Germany, the Eurozone and the U.K., U.S. ADP Employment, U.S. Initial Jobless Claims, U.S. Consumer Confidence and U.S. Markit Manufacturing PMI.

 

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 26 May 2017

MARKETS/MACRO: US equities continued their run higher, with both the S&P 500 and the tech-heavy Nasdaq posting fresh record highs as investors continue to digest Wednesday's release of the FOMC minutes. There was strength across the consumer discretionary sector as earnings from Best Buy (+21.5%), Sears (+13.5%) outperformed expectations. The Dow gained 70.53 points, or 0.3%, to 21,082.95, the S&P 500 added 10.68 points, or 0.4%, to 2,415.07, and the Nasdaq rose 42.23 points, or 0.7%, to 6,205.26. There were wins for discretionary (+0.9%), tech (+0.8%), utilities (+0.7%) and staples (+0.7%), while energy (-1.8%) was hit hard by the falling oil prices. European shares were mixed, the EuroSTOXX shed 0.23 points, or 0.06%, to 389.19, the German DAX retreated 21.15 points, or 0.2%, to 12,621.72, whilst the UK FTSE added 2.81 points, or 0.04%, to 7,517.71. In currency markets, the US dollar index was generally flat at 97.238, the EUR traded down to 1.194 while USD JPY traded up to 111.96. The AUD dropped to 0.7448. US treasury yields were higher, 2 year yields firmed 1.2 bps to 1.294% whilst 10 year yields edged higher 0.3 bps to 2.254%. In commodities news, oil prices were hammered as the market was disappointed by the OPEC decision not to increase the size of production cuts, despite agreeing (along with Russia and other non-member countries) to extend them by 9 months to March 2018. Brent dropped 5% to $51.27 while WTI slid 5.3% to $48.65. Base metals were mixed, aluminium (+0.8%) was the big winner as nickel (-0.7%) gave the most away. In US economic data, the advanced trade deficit for goods widened to $67bln in April from an upwardly revised $65.1bln in March, contrary to economists expectations it would tighten to $64bln. Both wholesale and retail inventories decreased 0.3% in April. Initial jobless claims rose 1k to a seasonally adjusted 234k in the week ending May 20. Continuing jobless claims rose by 24k to 1.92M. In Asia today, as I write the Nikkei sits at -0.64%, the Shanghai composite is at +0.13%, the Hang Seng at -0.03%, and the ASX S&P 200 finished at -0.66%.

PRECIOUS: Quiet session for the precious in light trade despite the Comex June gold expiry. Gold tested $1260 a few times during Asian hours but resting offers capped the market. The yellow metal drifted slightly lower through London AM and touched the low of $1254 during NY hours, but ultimately remained within a $5 range for the entirety of the session. Silver drifted lower through the day to finish up at $17.12. Palladium was the best performer on the day, closing in positive territory at $770. The Philadelphia gold and silver index lost 0.93%. The SPDR gold trust holdings were unchanged at 847 metric tonnes. In todays trading, Gold drifted a couple dollars on the open in Asia but found support out of China as SGE premium hovered around $10-11 over loco London and USD/JPY came off. The yellow metal is sitting at high in the PM session, at $1260.80 as I write. Silver is creeping higher also, the grey metal sitting at the high of $17.22 as I write. PGM's are looking firmer as the day progresses, both platinum and palladium currently at the highs for the day.

 

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 22 May 2017

MACRO: U.S. markets continued to recover on Friday amid the ongoing turmoil in Washington, booking their second consecutive session gain, however unable to climb back into positive territory on a weekly basis. The DJIA ended the session +0.69% higher at 20,804.84 points, with Caterpillar Inc. (+2.21%) and General Electric (+2.07%) underpinning the move higher. The S&P 500 saw each of its main 11 sectors trade in positive territory, led by gains to Industrials (+1.36%) and energy (1.24%) to end the session +0.68% higher at 2,381.73 points. Both the DJIA and the S&P 500 ended the week around -0.4% lower, unable to claw back losses following Wednesday's rout. Oil futures settled higher on Friday, however tempered gains late in trade following a report from Baker Hughes noting active oil rigs in the U.S. increased for an eighteenth straight week. WTI climbed above USD $50 per barrel to end +2.2% higher and book a +5.2% weekly gain, while Brent crude climbed to a 1-month high to gain over +2% for the session and end around +5.5% higher for the week. U.S. treasury yields edged marginally higher on Friday, however on a weekly basis booked the largest decline in over a month during the week ended 19 May. The 10-year note yield inched 1bps higher to end at around 2.24%, finishing the week around 8.8bps lower, while the 2-year added just over 1.1bps to 1.278%. Markets in Europe pushed higher on Friday, however much like their U.S. counterparts were unable to claw back mid-week declines and ended the week softer. The Stoxx Europe 600 added +0.6% for the session, however booked the first weekly decline in four weeks to hand back -1%. The German Dax tacked on +0.4% as producer prices posted their strongest annual gain in over five years during April, although the bourse was unable to claw back mid-week declines and ended -1% lower on a weekly basis. Equities in the U.K. received a boost from a weaker sterling on Friday, adding +0.5% for the session to record a fourth consecutive weekly advance, ending +0.5% higher over the week.

PRECIOUS: Gold spent Friday consolidating following Thursday's declines in New York, using USD $1,250 as a base to edge higher throughout the session. Interest out of China supported the yellow metal above USD $1,250 during Asian trade, while a brief dip below the figure during the Shanghai lunch break saw solid regional interest restrict declines. Mixed European pricing saw the metal generally hold support at USD $1,250 and trade with a modest bid bias leading into U.S. hours, while late New York trade took gold to a USD $1,256.30 session high as the USD edged lower. The North Korean missile test over the weekend gave gold a boost during early trade on Monday, however interest soon turned offered to see the metal toward USD $1,250 mid-session. Afternoon trade kept the metal buoyant above the figure, trading back through USD $1,255 into European hours. Support broadly sits around USD $1,250, while USD $1,265 - $1,270 will need to be broken for a further leg higher. After closing toward USD $16.90 on Friday, silver saw a stop loss run through USD $17 in thin early Asian trade, printing a USD $17.14 high before easing lower on profit taking once China opened. The grey metal benefited from good physical flows throughout afternoon pricing to once again push toward USD $17 as Europe opened. USD $17 looms as a pivot point for the metal, with solid upside potential should the figure hold. Platinum traded a narrow range during Asian hours on Monday to consolidate Friday's gains, while palladium interest was non-existent. Data today is limited to the Chicago Fed Nat Activity 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 : Wed 31 May 2017

MARKETS/MACRO: U.S. stocks ground lower overnight in slow-going post long weekend trade amid weakness in energy and financials and despite consumer spending growth printing at its fastest pace for the year. The Dow Jones slid -50.81 points, or -0.24%, to 21,029.47, the S&P500 crept down -2.91 points, or -0.12% to 2,412.91 and the Nasdaq declined -7.004 points, or -0.11% to 6,203.19. Amazon (+0.1%) briefly traded with a $1,000 handle for the first time, the stock surging 33% YTD or double the Nasdaq's gain. Losses in energy (-1.3%) and financials (-0.8%) led the decline, while teleco's (+1.4%), utilities (+0.3%) and tech (+0.3%) posted the best performances. European stocks retreated for a 4th day amid further weakness in the banks following a sector downgrade. The FTSE Euro First 300 index lost -3.33 points, or -0.22% and the euro Stoxx 600 fell -0.75 of a point, or -0.19% to 390.50. Regionally the DAX shed -0.24%, FTSE100 -0.28% and CAC40 -0.50%. Crude oil prices continue to ebb and flow (WTI -0.6% to $49.49) as the market awaits signs of re-balancing following the extension of OPEC’s production cut agreement. Russian President Vladimir Putin and Deputy Crown Prince Mohammed bin Salman (Saudi Arabia) met in Russia on Tuesday to solidify the cooperation between the two major oil producers. Both indicated that this latest move (to extend the production cut agreement) should support oil markets. Bloomberg also reported that Libyan oil output has fallen to 750k b/d after the Arabian Oil Co cut output. Base metals were mixed, with investors remaining on the sidelines ahead of the Chinese PMI data due for release today. Copper remained unchanged, despite some positive signs of better demand. Cancelled warrants (order to remove inventories from warehouses) climbed to its highest level in three years. Glencore also indicated that high costs threaten the viability of its Australian operations, indicating possible closures. Treasuries pushed higher over the afternoon, supported by pockets of real money buying at the longer end of the curve ahead of month-end. The 2y note yield fell -1.2bps to 1.282% and the 10y bond yield dropped -4bps to 2.208%.

On the data front, U.S. consumer spending posted its strongest growth in four months during April. Consumer spending rose +0.4% MoM (+0.4% expected) from an upwardly revised +0.3% in March (flat prior), while personal incomes also increased +0.4% MoM (+0.4% expected). The Federal Reserve’s preferred measure of inflation, the price index for personal-consumption expenditures, rebounded - up +0.2% MoM (+0.2% expected) after declining -0.2% in March. Core prices rose +0.2% MoM (+0.1% expected) after edging down -0.1% in March. Nonetheless inflation continued to weaken on an annualised basis, overall prices jumping +1.7% YoY (+1.7% expected) but down from +1.9% in March. Elsewhere, U.S. consumer confidence retreated in May. The Conference Board’s consumer confidence index fell to 117.9 (119.5 expected) from April’s final reading of 119.4. The Present Situation Index increased marginally from 140.3 to 140.7, while the Expectations Index declined from 105.4 last month to 102.6 in May. "Consumers' assessment of present-day conditions held steady, suggesting little change in overall economic conditions. Looking ahead, consumers were somewhat less up-beat than in April, but overall remain optimistic that the economy will continue expanding into the summer months", said Lynn Franco director at the Conference Board.

Fed Governor Lael Brainard spoke with a hawkish tone overnight. "With the labour market continuing to strengthen, and GDP growth expected to rebound in the second quarter, it would be reasonable to conclude that further removal of accommodation will likely be appropriate soon" she said. However "if the tension between the progress on employment and the lack of progress on inflation persists, it may lead me to reassess that prediction...The apparent lack of progress in moving core inflation back to 2% is a source of concern". When you have dual mandates but only one instrument, one mandate will dominate, and it will be inflation in this instance for a central bank.

PRECIOUS: Gold traded at fresh monthly highs during Asian hours yesterday, briefly inching above $1270, yet failed to push through this in the the London and NY sessions. Yesterday was a second day of holidays for China and HK, so activity throughout the morning was relatively subdued. What drove the market higher initially was a sell off in EURUSD and USDJPY, that kicked off following some negative Greek headlines that "it may opt out of it's next repayment tranch without a debt deal". Gold ran from $1267 through $1270 following the release and consolidated (stalled) either side of that level for over an hour. As the volume subsided around the $1270 mark, EUR bounced off the lows as did USDJPY and the gold declined in a volatile fashion. The metal hit $1260.10 just as NY traders walked in which was the low point of the session. Some light real money buying accrued around the $1260 mark and gold accelerated up to $1264 before consolidating in a dull, narrow range of $1262-64 over the final 6 hours of trade. Resistance for gold sits initially at yesterdays high ($1270.00) followed by a significant downtrend line dating back to the all time highs in 2011 at $1272.00. It will be interesting over the next few days to see whether the selling will subside with much of the GCM7 roll to GCQ7 completed. Silver followed gold throughout the day, although bounced back strongly during the NYK hours yesterday, rounding out the session virtually unchanged.

ASIA TODAY: Gold and silver remained under pressure throughout much of the day today. After opening around $1262.50, gold traded sideways throughout the majority of the morning on very light flows, traders waiting to see what China would do on their first day back after the 2-day Dragon Boat holiday. Following the SGE open there was light 2 way interest seen initially with the premium on the SGE hovering around $8-9 over the loco London price. Later during the day USDCNY and USDCNH began to tank which ramped up the selling on the Shanghai exchange which saw gold trade back to $1260 and silver fall more dramatically towards $17.25 after opening just shy of $17.40. The reason the USDCNH and USDCNY came off was in part due to the better than expected manufacturing and non-manufacturing PMI's. China's manufacturing PMI held steady, coming in slightly better than expected for May at 51.2 (51.0 expected), while the non manufacturing came in at 54.5, 0.5 better than a month earlier. Selling pressure slowed into the afternoon, however there was no real bounce back for either gold or silver. In other markets Asian equities were mixed the ASX200 leading the pack up +0.2% at time of writing, the Shanghai composite is up +0.1%, while the Hang Seng -0.1% and Nikkei -0.3% sit in negative territory. The USD was generally a little stronger (GBPUSD -0.3% at 1.2820, AUDUSD -0.2% at 0.7450), with the notable exceptions being USDCNH (-0.3% at 6.8035) and USDCNY (-0.25% at 6.8450). Ahead today on the data calendar look out for German retail sales and employment, Eurozone CPI and unemployment, Canadian GDP and U.S. Chicago PMI and pending home sales.

 

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

DAILY REPORT : Thursday 25 May 2017

MACRO: The minutes from the May 2 - 3 FOMC meeting released overnight showed that "most participants" expected it would "soon be appropriate" to increase rates, heightening expectations surrounding the June meeting. However, with that being said, “Members generally judged that it would be prudent to await additional evidence indicating that the recent slowing in the pace of economic activity had been transitory before taking another step in removing accommodation,” the minutes noted. The committee viewed the overall growth outlook as little changed since the March meeting, with risks still "roughly balanced", however they did highlight developing international concerns. The minutes added further colour to the path of balance sheet normalisation, noting that the committee intends to phase out reinvestments by introducing monthly caps on how much asset run-off will be allowed each month. Expectations are that this process will likely begin late 2017. The next meeting is scheduled for June 13-14, which will be followed by a press conference by Federal Reserve Chair Janet Yellen. Existing Home Sales in the U.S. dropped -2.3% MoM during April (exp: -1.1%) to a seasonally adjusted annual rate of 5.57 million. The National Association of Realtors noted that "Demand is easily outstripping supply in most of the country and it’s stymieing many prospective buyers from finding a home to purchase,” The supply of homes on the market has fallen YoY for 23 consecutive months and there was a 4.2 month supply of homes on the market at the end of the month, down from 4.6 months a year ago. The median sales price rose +6% YoY to USD $244,800. Equity markets in the U.S. pushed higher on Wednesday to continue the recovery from last Wednesday's collapse, seeing the S&P 500 to a fresh record close. The DJIA finished in positive territory for the fifth consecutive session, adding +0.36% to close at 21,012.42 points and in the process booking its longest winning streak since February. The S&P 500 saw strength from materials (+0.69%) and utilities (+0.68%) to post a +0.25% gain, erasing the entirety of last week's losses and booking a fresh record close at 2,404.39 points. The Nasdaq outpaced to end the session +0.4% higher at 6,163.024 points. Oil futures reversed European gains in New York on Wednesday, with participants considering the outcome of the joint committee of members and non-members of OPEC in Vienna. Initial reports out of the meeting that the committee had put forth a 9-month extension failed to support prices as WTI eased around -0.2%, while Brent crude posted a -0.4% decline. Markets across Europe ended modestly mixed on Wednesday as investor's awaited the outcome of the OPEC meeting in Vienna and the Federal Reserve minutes release from the May meeting. Dovish comments from ECB president Mario Draghi did little to elicit a reaction from participants, seeing the Stoxx Europe 600 ease just -0.1%, while the German Dax also ended the session -0.1% lower. The U.K. FTSE 100 (+0.4%) logged it's highest close in just over a week as the major miners recovered from early session declines that were largely driven by the credit downgrade of China.

PRECIOUS: The precious complex pushed higher into the close on Wednesday, buoyed by the non-committal FOMC minutes to end modestly higher for the session. A muted Asian session gave way to a brief period of weakness in Europe, seeing gold through support at USD $1,250 on a stop loss run, before bids once again supported the metal above the figure. New York held a narrow range leading into the FOMC minutes release, before a sharp sell off to the USD saw the yellow metal strengthen late in trade, testing toward USD $1,260 to end around +0.6% higher. Asian interest on Thursday could best be described as buoyant but sedate, with regional participants showing interest underneath USD $1,260, however lacking the conviction to push the metal through the figure. China traded with a modest bid bias as the on-shore premium edged marginally higher throughout the session, however a lack of follow through buying kept the price action within a narrow range and the metal opened in Europe largely unchanged. Interest around USD $1,250 should provide short-term support for the metal, while open option interest around this level is likely to restrict top-side gains into expiry today. Silver managed to hold onto the USD $17 handle on Wednesday, however had to contend with early European offers dragging the metal to a USD $16.90 low. The grey metal saw solid interest below the figure, recovering to a USD $17.15 high leading into New York hours, before late session USD weakness saw a USD $17.23 high to book a +1.4% return for the session. Asia saw modest early offers on Thursday, however the metal spent the majority of the session above USD $17.20, with interest out of China keeping the price action buoyant into the European open. Palladium edged marginally higher in Asia on Thursday following the -1% decline in New York on Wednesday, while platinum continues to flirt with a sustained move above USD $950. Data tonight includes U.K. GDP, U.S. Wholesale Inventories, U.S. Initial Jobless Claims and Bloomberg Consumer Confidence.

 

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

DAILY REPORT : Friday 19 May 2017

MARKETS/MACRO: US equities stabilised after Wednesday's carnage, with the three major bourses all finishing ahead. The Dow rallied 56.09 points, or 0.3%, to 20,663.02, the S&P 500 added 8.69 points, or 0.4%, to 2,394.44, and the Nasdaq bounced 43.89 points, or 0.7%, to 6,055.13. There were wins for telecoms (+1.2%), discretionary (+0.6) and tech (+0.6%), while energy (-0.1%) was the lone laggard. European shares were lower, the EuroSTOXX shed 1.95 points, or 0.5%, to 389.19, the German DAX retreated 41.55 points, or 0.3%, to 12,590.06, whilst the UK FTSE lost 41.55 points, or 0.3%, to 12,590.06. In currency markets, the US dollar index rallied 0.27% to 97.849, the EUR traded down to 1.1085, whilst USD JPY traded up to 111.57. US treasury yields were higher, 2 year yields firmed 2 bps to 1.266% whilst 10 year yields edged higher 0.3 bps to 2.228%. In commodities news, oil markets were higher again as Brent put on 0.5% to $52.49 and WTI gained 0.6% to $49.35. Base metals were broadly lower, with zinc (-1.1%) leading the losses. In US economic data, the Philadelphia Fed manufacturing index surged to 38.8 in May from 38.8 in April, the reading is almost double economists forecast of 19.6. Interestingly, the data is in stark contrast to the Empire State index released on Monday, which posted it's first negative print since last years Presidential election. The Conference Board's leading economic index rose 0.3% in April following a 0.5% in March. A representative from the Board commented "The recent trend in the US LEI, led by the positive outlook of consumers and financial markets, continues to point to a growing economy, perhaps even a cyclical pick up". Initial jobless claims fell 4k to a seasonally adjusted 232k in the week ending May 13. Continuing jobless claims fell by 22k to 1.9M, the lowest level since 1988. In news out of Brazil, local markets in the worlds 9th largest economy were hammered on the news that President Michel Temer had been accused of bribery. The Brazilian real was dumped 8% against the US dollar and equities tanked 10% before trading was halted.

PRECIOUS: A volatile session for the precious, giving back all yesterdays gains. Gold hovered around the $1260 level after Asian open before heavy selling in China saw the market down to $1253. The rebound from here was strong and continued through London open as USD JPY fell below 111, with the yellow metal reaching the days high of $1264.90 in the London morning session. Resistance above $1260 proved too strong again as gold was sold $17 lower through the NY trading day, helped along by a rally in the greenback on the positive data releases. The market finished up around the lows. Silvers strong run came to an end, the grey metal falling 38c from the days high to close around the lows. PGMs were sold heavily also. The Philadelphia gold and silver index lost 2.65%. the SPDR Gold Trust holdings fell 1.18 metric tonnes.

ASIA TODAY: Gold pushed a few dollars higher in Asia this morning to trade around $1250 with the SGE premium back up to $10-11 over loco London. After a dip in the afternoon the yellow metal climbed to the days high of $1251 as the US dollar came off. The market is at $1251.10 as I write. Silver is trading similarly, the grey metal ticking up to the days high of $16.70 in the PM session and sitting at $16.69 as I write. PGMs find themselves in positive territory as well. In other markets, as I write the Nikkei sits at +0.19%, the Shanghai composite is at +0.01%, the Hang Seng at +0.31%, and the ASX S&P 200 finished at -0.19%. Tonight we have the advance services report out of the US; and consumer confidence out of the Eurozone.

 

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 30 May 2017

MACRO: Equity markets were closed in the U.S. on Monday for the Memorial Day holiday and there were no major data releases. European Central Bank President Mario Draghi spoke in Brussels on Monday, emphasising the fact that the region still requires expansive monetary stimulus. "We remain fully convinced that an extraordinary amount of monetary policy support, including through our forward guidance, is still necessary," President Draghi noted. Regional equities ended mixed on Monday amid thin holiday volumes. The Europe Stoxx 600 slid just -0.02% to book its third consecutive session loss, while the German Dax added +0.21% and the Italian FTSE MIB Index dropped over -2% following weekend reports that an election could take place as early as September. British airways parent company, International Consolidated Airlines didn't trade in the U.K. on Monday following the weekend IT issues, however the company's Spanish listed shares fell around -2.8%. Equities were closed in the U.K. Currency majors saw the pound recover from Friday's election poll driven weakness, while the Euro eased following ECB President Mario Draghi's comments. Oil futures traded sideways on Monday in thin holiday volumes, seeing WTI above USD $50 per barrel for a modest +0.2% gain.

PRECIOUS: With China taking a break for the Dragon Boat Festival and both the U.K. and the U.S. on leave, precious metals generally tracked sideways on Monday, taking cues from the USD for direction. Any early push toward USD $1,270 following news of another North Korean missile test soon ran out of legs and gold drifted toward support at USD $1,265 in muted volumes. The metal held between the support and USD $1,268 throughout the remainder of the session, closing early in New York around the middle of the range. Trade during Asian hours on Tuesday saw a little more life than Monday's session, seeing gold test briefly above USD $1,270 and generally holding onto gains throughout the afternoon as participants considered ECB President Draghi's comments out of Brussels. The session high of USD $1,270.30 in Asia on Tuesday was in the face of a stronger greenback, and marks the highest level for spot bullion since May 1, coming as Comex rolls over to the August contract from June previously.
Silver saw interest in Europe and U.S. hours on Monday to push above USD $17.40, marking the highest print since April 28 in the process. Asian demand on Tuesday continued to support the metal higher, inching through Monday's New York print after recovering from mild early session offers. Platinum lost touch with USD $960 on Monday and was unable to reclaim the figure during Asian hours on Tuesday, while palladium was held underneath USD $800 in Asia following a brief move through the resistance on Monday. Data tonight includes the German Import Index, German CPI, French GDP, Eurozone Consumer Confidence, U.S. Personal Income / Spending, U.S. PCE, U.S. Consumer Confidence (conference board) and the Dallas Fed Manufacturing Activity 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 : Wed 24 May 2017

MARKETS/MACRO: U.S. stocks closed narrowly higher and the S&P500 logged its first four day winning streak since mid-February on the back of strength across the financial sector. The Dow Jones Industrial Average edged up +43.08 points, or +0.21%, to 20,937.91, the S&P500 advanced +4.40 points, or +0.18%, to 2,398.42 and the Nasdaq crept up +5.094 points, or +0.08% to 6,138.712. Most sectors showed some very modest gains, however financials (+0.8%), easily delivered the best performance of the day, while discretionaries (-0.4%) were alone in negative territory. European equities advanced as May PMIs indicated businesses had managed to maintain April's impressive growth rate. The Euro First 300 Index ran +3.87 points higher, or +0.25% to 1,541.28 and the Euro Stoxx 600 was up +0.88 of a point, or +0.22%. Regionally the DAX was up +0.31%, CAC40 +0.47% and FTSE100 bucked the trend down -0.15% in the aftermath of the Manchester bombing. With Risk stabilising overnight the dollar staged an impressive intra-session comeback. Trump’s first major budget promising to eradicate US fiscal deficit in 10 years was unveiled and the White House further reiterating there is no evidence of collusion helped. Both factors, combined with rising Fed expectations of June now again above 80% and US front end rates selling off following a weak 1yr auction, set the tones for the dollar. With regards to EUR, this dollar backdrop further compounded Coeure’s speech that down played the deposit hike story. Having already been stretched in terms of positioning post Merkel comments, EUR made a swift move below 1.12. West Texas crude reached its highest level since April 20, falling just shy of $51.80 overnight. The commodity is being buoyed by news that Saudi Arabia is garnering support for an extension of production cuts ahead of the OPEC meeting in Vienna later this week. Base metals were mixed overnight, zinc prices gaining amid expectations of firmer Chinese import demand following news that both domestic production and inventories on the Shanghai exchange were falling.

A host of PMI's were released overnight. In the U.S. the manufacturing sector business conditions improved, albeit at the slowest pace since September last year. Markit's Flash PMI printed 52.5 (53.0 expected) from 52.8 in April. The reading was driven by softer rates of output, new order and employment growth. The rate of production expansion eased further from the peak seen at the start of the year. Some manufacturers suggested that domestic clients had adopted a wait-and-see approach to investment spending according to Chief economist at Markit Chris Williamson. Still in the U.S. the Markit Services PMI continued to accelerate following the six month low seen in March. The PMI rose to54.0 (Mkt est: 53.3) from 53.1 in April. Service providers noted that improving economic conditions and greater willingness-to-spend among clients had supported business activity growth in the month. Across the Atlantic, the picture was equally impressive, the Markit eurozone “flash” PMI holding at a six-year high in May of 56.8 (56.7 expected). In Germany, the flash manufacturing PMI hit a 6 year high at 59.4 (58.0 expected) even as services activity dipped to a 3 month low. The preliminary reading of French services activity for May jumped to 58.0 (56.8 expected) which was the key to driving the composite figure higher. In Germany again the IFO Institute said its measure of business sentiment rose to 114.6 (113.1 expected) from 113.0 in April, reflecting what it described as a euphoric mood. Clemens Fuest, president of the IFO Institute, said the confidence measure points to quarter-on-quarter growth of +0.6% in the three months to June, which would leave it unchanged from a strong start to the year. “Economic activity in Germany remains very brisk,” he said.

PRECIOUS: Gold opened yesterday around $1260 and immediately met broad based USD selling, as the headline "U.S. president Trump had sought support to U.S. intelligence officials to push back FBI's investigation of connection between his campaign and the Russian government' did the rounds. USDJPY swiftly dropped 20-30 pips on the news and gold rallied a few dollars. Minutes after that Trump headline news broke, headlines began to filter through of a bomb explosion during pop singer Arianna Grande's concert in Manchester, in an expected suicide bombing (current death toll stands at 22). Gold continued to rally on the back of this, touching $1264 a number of times but that level - last weeks high - held well during early trade. The selling volume mounted following the SGE open, which put pressure on the spot market despite the morning headlines and a USD that looked increasingly weak. Some very large visible offers on Ecomex (GCM7) of around 1000+ lots above $1263.50 also did not help matters. The yellow metal continued to taper off as London traders walked in, dipping through $1260 towards $1258, consolidating either side of the AM Auction either side of $1260. A brief pop towards $1263 saw those large Ecomex offers come into play again, though the metal did a quick about face and sank throughout the remainder of the session towards $1251, with a lone relief rally quickly being sold into. A surge in the USD (USDJPY back to 111.80) was the main catalyst for the NY sell-off, gold ultimately closing just off the lows at $1251.50 in what was a disappointing session. Silver was impressive throughout the early NY hours, jumping to fresh cycle highs as stops were tripped through the previous days high ($17.20). The white metal hit a peak of $17.305 before the USD began its ascent and specs quickly pulled the plug on morning longs. In the end the silver closed along with gold, just off the days lows at $17.06 - also disappointing. We expect gold to remain pinned towards $1250 in the coming days ahead of Thursdays expiry, with some decent sized strikes at that level.

ASIA TODAY: It was a slower day today, with gold stabilising just above $1250 throughout most of the session as some modest Asian demand steadied the ship. We opened this morning around $1251 to some initial demand from early Asian 'fast money' traders, happy to lock in profits following the overnight dip. The buying remained modest however and the yellow metal only managed to edge up a few dollars capping out just shy of $1254 as Tocom came on line. Once SGE opened up they were fairly neutral, which was a little surprising given the strong selling seen on the exchange yesterday. With that said there was some light retail buying which kept trade in a very tight range throughout much of the morning ($1251-53). Silver, despite a brief tick higher on the open and again after Tocom opened, remained fairly heavy throughout the day. The metal meandered its way lower testing $17.00 for much of the afternoon. The Chinese were decent sellers however and after they returned from their lunch break helped push it lower. We are currently trading around $16.90 and it still feels a little soggy. In other markets Asian equities were mixed, at time of writing the Hang Seng is -0.15% and Shanghai Composite -0.8%, while the Nikkei is up +0.55% and ASX200 up +0.05%. Crude has ticked a little higher (last $51.59 or +0.2%) and the USD has continued its strong NY run and is firmer on the day - most noticeably against AUD (down 25 pips or -0.4% at 0.7405 last) and USDJPY (up 20 pips or +0.2% at 112.00 last). Ahead on the data calendar today look out for U.S. existing home sales, BoC rate decision and the FOMC meeting minutes.

 

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 18 May 2017

MACRO: Equity markets in the U.S. collapsed on Wednesday as concerns over Donald Trump's FBI controversy had investor's running for the exits. Both the DJIA and the S&P 500 booked their worst declines in 8-months (since September 9) and in doing so, saw the VIX 'fear gauge' surge a staggering +46.8%, the largest daily move since June 24. The DJIA ended the session -1.78% lower at 20,606.93 points, while the S&P 500 ended -1.82% lower as financials (-3.04%) and information technology (-2.79%) bore the brunt of investor's wrath. The Nasdaq meanwhile suffered the worst decline since the day after the U.K. voted to leave the European Union, collapsing -2.57% to end the session at 6,011.236 points, just a day after posting a fresh all-time record close. Treasury yields declined on Wednesday as investor's flocked to safety. The yield on the 10-year note declined over 11.4 bps to end the session around 2.22% and mark the largest one-day decline since June 27. The two-year declined over 5 bps to around 1.246%, while the 30-year bond cleaved nearly 10 bps to around 2.89%. The EIA reported the sixth consecutive decline in crude inventories on Wednesday, underpinning a rally in crude prices. WTI pushed back above USD $49 per barrel to end the session +1.4% higher, the highest finish since April 28. The Greenback continued to slide on Tuesday, as the Trump administration goes into damage control following renewed focus on the FBI probe into dealings with Russia. The DXY index ended the session around -0.4% lower as the EUR added close to +0.6%, while USD/JPY fell through 111.00 in New York to book a -2.2% decline. Markets in Europe posted steep declines on Tuesday, as the troubles in Washington reverberate across the continent. The Stoxx Europe 600 shed -1.20% to book the largest daily decline since late September, while the German Dax saw weakness across financials to end -1.35% lower. The FTSE 100 was dragged lower with global equities on Tuesday, however losses were relatively contained as the bourse eased -0.25%.

PRECIOUS: The precious complex continued to push higher on Wednesday, breaking through a number of technical levels as investor's flocked into safehaven assets amid the turmoil in Washington. Early Asian demand took gold above USD $1,240, while European participants took out resistance levels toward USD $1,250 to test the figure leading into New York. The flight out of equities in the U.S. provided further support for the yellow metal, triggering stops at USD $1,250 to surge to a USD $1,261.20 high, a gain of almost +1.9% from opening levels in Asia. Vols have moved higher on the recent strength to see 1m toward 11.2, while ETF flows saw modest additions. Asia saw mixed interest on Thursday as profit taking battled against underlying interest. Multiple tests of USD $1,263 were met with solid offers, while a modest uptick to the USD in afternoon pricing saw gold soften toward USD $1,255. We are likely to see profit taking weigh upon the metal over the short term, however the current political climate in the U.S. should see underlying interest continue to support the metal around USD $1,250. Silver was back to its volatile best on Wednesdays, pushing above USD $17 briefly, however unable to hold onto the bid tone and falling underneath the figure in whippy late session trade. The grey metal saw early session interest to hold around USD $16.90 during Asian hours on Thursday, however succumbed to offers leading into Europe to test below USD $16.70. Data today includes U.K. Retail Sales, U.S. Initial Jobless Claims and the U.S. Leading Index.

 

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

DAILY REPORT : Monday 29 May 2017

MACRO: The pace of growth in the U.S. exceeded expectations during Q1 according to the latest GDP data released on Friday. The U.S. economy increased at +1.2% YoY during the period (exp: +0.9%) from +0.7% previously estimated, with revisions to both consumer and business spending supporting the improved figure. Consumer spending edged higher to +0.6% YoY (exp: +0.3%) during the quarter, increasing from +0.3% previously, however still well down from the +3.5% printed during Q4 to mark the slowest pace since late 2009. Core PCE inched marginally higher to +2.1% QoQ (exp: +2.0%) from +2.0% previously. Durable goods orders in the U.S. fell into negative territory for the first time in five months during April, dropping -0.7% MoM (exp: -1.5%) to follow an upwardly revised +2.3% in March (prev: +0.9%). The headline print was dragged lower by a -9.2% fall to large commercial aircraft, while orders non-defence ex-aircraft printed unchanged (exp: +0.5%) to following a downwardly revised flat read during March (prev: +0.5%). Shipments of core capital goods inched down -0.1% (exp: +0.5%) after increasing +0.2% in March (prev: +0.5%). Consumer sentiment in the U.S. eased in May to see the University of Michigan’s final reading of consumer sentiment slide to 97.1 (exp: 97.5) from an earlier flash read of 97.7. Equity markets in the U.S. ended trade on Friday narrowly mixed amid thin holiday volumes, seeing the S&P 500 and the Nasdaq to fresh record closing levels following the upwards revision to GDP. The DJIA eased just -0.01% to 21,080.28 points, while gains to consumer staples (+0.33%) and consumer discretionary (+0.31%) outweighed weakness across real estate (-0.64%) to take the S&P 500 +0.03% higher to a fresh record close of 2,415.82 points. The Nasdaq meanwhile added +0.08% for the session to close at a record of 6,210.194 points. Oil prices recovered from a pre-New York slump on Friday as investor's put aside concerns over OPEC's output cap announced on Thursday, however a Baker Hughes report noting active U.S. oil rigs increased by 2 to 722 tempered gains. WTI closed the session just underneath USD $50 per barrel to book a +2% gain, while Brent crude added around +1.5% for the session. Markets in Europe turned lower on Friday, trading heavily on the back of soft trade to oil and gas shares following OPEC's announcement on Thursday. The Stoxx Europe 600 shed -0.20% as the bourse's oil and gas index slumped -1.1%, while the German Dax posted a -0.15% decline on soft trade to auto's following comments from Donald Trump regarding Germany's auto exports to the U.S. In the U.K. the FTSE 100 bucked the regional trend to end in positive territory, adding +0.40% as the pound declined following polls suggesting the Labour party is continuing to gain ground ahead of the June 8 election.

PRECIOUS: Gold trended higher on Friday as geopolitical concerns once again weighed upon investor risk appetite. Chinese interest leading into their Dragon boat festival holiday provided an early bid tone for gold, seeing the metal toward USD $1,260 as the on-shore premium trended toward USD $10 over loco London prices. A softer greenback and heavy trade to European equities provided further support for gold during London hours, pushing the metal initially above USD $1,260, with a further stop loss run on a test of the recent (May 18) USD $1,265 high well supported. Early U.S. session offers were well absorbed and the yellow metal was able to push to a near 4-week high of USD $1,269.55 into the close, booking a +0.9% return for the week. Asian trade on Monday was a relatively muted affair, with early session interest following a reported North Korean missile test soon fizzing out and seeing gold hold a narrow range as China enjoyed the first of their two-day break. The greenback spent Monday's session with a mild bid bias to weigh upon the yellow metal, however with holiday's today in the U.S. and the U.K. we are unlikely to see much deviation from the USD $1,265 - $1,270 range. Silver performed strongly on Friday to pull away from USD $17, closing toward the USD $17.38 high to book a +1.2% session gain and end the week +3.1% higher. The grey metal tracked sideways during Asian hours on Monday, testing the Friday high in early trade before tapering off throughout the afternoon. Platinum held a narrow range during Asian trade today to consolidate Friday's +1% gain, while palladium edged toward USD $800 to add further length following Friday's +2.4% move.

 

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 23 May 2017

MACRO: The Chicago Fed National Activity Index increased during April, pushing to +0.49 (exp: +0.11) from a modestly downwardly revised +0.07 in March (prev: +0.08). The headline print was the highest read since March 2014 and was supported by a jump in production related indicators, increasing to +0.46 from +0.01, while employment related indicators pushed to +0.10 from +0.05 previously. The three month moving average improved to +0.23 from a neutral print in March, marking the fifth consecutive month of a flat or positive result. Equity markets in the U.S. continued to run higher on Monday, marking the third consecutive session of positive closes as industrial stocks benefitted from Trump's visit to Saudi Arabia. Gains to Boeing Co. (+1.61%) and 3M Co. (+1.38%) supported the DJIA to a +0.43% gain, while the S&P 500 tacked on +0.52% with energy (-0.17%) the only negative result across the eleven major sectors. The Nasdaq outperformed to post a +0.82% return in below average volumes, ending the session at 6,133.618 points. Oil futures firmed on Monday, supported by reports that Saudi Arabia and Iraq are in agreement on extending the current OPEC production cuts for a further 9-months. June WTI added just under +1%, likely benefitting from the end of session expiration, while Brent crude tacked on +0.5%. The greenback once again traded softer on Monday, losing ground predominately against the EUR as the common currency touched a fresh 6-month high following comments from German Chancellor Angela Merkel. Speaking to students in Berlin, Chancellor Merkel blamed the ECB for promoting policies that have made the EUR too weak. Regional markets reacted negatively to the comments as the EUR firmed, seeing the German Dax -0.15% lower, while the broad Stoxx Europe 600 shed -0.09%. In London, the U.K. FTSE 100 booked a +0.34% gain as jitters surrounding the upcoming election weighed upon the pound.

PRECIOUS: Gold started the week on a positive note, building upon Friday's gains to end at its highest level in 3-weeks during Monday's session. Early profit taking out of Asia saw the metal pull back toward support at USD $1,250, however underlying interest restricted any further declines as Europe took the metal back above USD $1,255 on the EUR strength, testing USD $1,260 leading into New York. Further declines to the greenback throughout the U.S. session saw gold push through the USD $1,260 resistance and print a session high of USD $1,262.40 before pulling back modestly into the close and finishing around +0.4% higher. ETF's registered a further 130k ounces of gold inflows on Monday to support the price action. Asia opened to the terrible news of a suspected terrorist attack at a concert in Manchester (U.K.), with so far 19 reported fatalities and over 50 injuries. The news out of the U.K., in conjunction with headlines noting Trump had reportedly asked top intelligence officials to deny any evidence of collusion with Russia, soon had gold testing the overnight high print in early Asian trade. A push towards USD $1,264 was met with offers leading into the Shanghai open, however the metal once again saw firm interest to test higher once China opened for business, holding a narrow range throughout the afternoon. Headlines out of Washington are likely to provide continued support for the metal, with USD $1,265 (last weeks high) the first resistance and USD $1,270 above this. Initial support sits at USD $1,260 and below this USD $1,250 is likely to see strong interest. Silver saw whippy price action on Monday, surging through USD $17 in thin early Asian trade (USD $16.83 open), before sharply paring gains once Japan opened. The grey metal was able to retake the figure during European hours, while U.S. interest took out the Asian high (USD $17.14) to print a session high of USD $17.20 for a +1.7% return. The grey metal held a relatively narrow range during Asian trade on Tuesday, testing USD $17.20 in early pricing and spending the remainder of the session consolidating the overnight gains. Silver's push through USD $17 last week was met with a -3.5% reversal in just 24 hours, therefore pricing over the next few days will be critical for the metal, needing to hold USD $17 for a leg high back toward USD $18. Platinum was finally able to break above USD $950 on Monday, however the move has not been overly convincing and the metal spent Tuesday's session in Asia oscillating either side of the figure. Palladium also traded within a narrow range in Asia on Tuesday following a stunning +1.4% gain on Monday and will need to consolidate above USD $770 - $775 if it is to trouble USD $800 over the short term. Data tonight includes German GDP, Markit Manufacturing / Services / Composite PMI prints from France, Germany and the Eurozone, German IFO survey results, Markit Manufacturing / Services / Composite PMI prints out of the U.S. and U.S. New Home Sales

 

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

 

DAILY REPORT : Wed 17 May 2017

MACRO: Housing starts in the U.S. disappointed during April, falling -2.7% MoM (exp: +3.7%) to a seasonally adjusted 1.172 million (exp: 1.206 million). The monthly print is an improvement from March's -6.6% fall, however marks the third negative print in the last four months. Multi-family starts was the main drag on the headline print, collapsing -9.6% MoM, while single-family starts inched +0.4% MoM higher. Lawrence Yun, chief economist at the National Association of Realtors noted with the release, “With housing starts declining in April, inventory shortages will continue for a longer period of time. The intensifying housing shortage will push up home prices and rents, easily above wage growth and the broad consumer price inflation,” Building permits retreated from March's strong print, sliding -2.5% MoM during April (exp: +0.2%) from +3.4% previously, led lower by a -4.5% decline to single-family permits. U.S. industrial production grew at the fastest pace in three years during April, outpacing expectations to increase +1.0% MoM (exp: +0.4%) from +0.4% previously. Manufacturing output increased +1.0% MoM (exp: +0.4%) to mark the strongest increase since early 2014, supported by a +5% jump in the production of motor vehicles and parts. Mining sector output increased +1.2% MoM, while utility output added +0.7% MoM. Equity markets in the U.S. ended trade generally lower on concerns over President Trump's dealings with Russia. The DJIA eased just -0.01% to finish generally unchanged at 20,979.75 points, while the S&P 500 slipped -0.07% as telecoms (-0.61%) and realestate (-0.52%) led the declines. The Nasdaq continued to outperform, ending the session +0.33% higher at a fresh record closing level of 6,169.87 points as Microsoft (+2.01%) and IBM (+1.43%) supported the bourse higher. Oil futures edged lower during U.S. hours on Tuesday, following a report from the International Energy Agency warning that an extension of the OPEC production cut will not be enough to balance the global market. WTI was unable to test the Monday session high print, tailing off in New York to slide back below USD $49 per barrel and end the session -0.8% lower. The greenback continued to trade heavily on Tuesday, sliding to a six-month low on the back of geopolitical concerns. The dollar slipped to its lowest level since early November against the Euro, seeing the pair test 1.110 and end around +1% higher. European equities closed generally lower on Tuesday, however the U.K. FTSE 100 outperformed to book a fresh record close following a strong inflation reading for April. Consumer prices in the U.K. increased at the fastest pace in over three years, gaining +2.7% YoY (exp: +2.6%) during April, from +2.3% YoY during March. A softer sterling following the CPI print provided support to the bourse, gaining +0.91% to a fresh record close of 7,522.03 points. Gains to the EUR and soft trade to auto-shares kept regional equities under pressure on Tuesday, with both the Stoxx Europe 600 and the German Dax ending -0.02% lower.

PRECIOUS: Gold saw interest on the back of a softer greenback and geopolitical uncertainties on Tuesday, ripping higher in New York to test USD $1,240 and ending the session just underneath the figure. The yellow metal opened with a mild bid in Asia, as Chinese demand kept the metal buoyant above USD $1,230. Offers broadly toward USD $1,235 capped further top-side moves during late Asia and throughout European hours, before U.S. participants took the metal to a USD $1,239.00 session high with EUR/USD testing a break of 1.110. Late session pricing saw gold pull back modestly, however holding above USD $1,236 to end with a modest +0.4% gain. The U.S. political developments continued to weigh upon the USD during Asian hours today, sending investor's piling into the precious complex in early pricing as close to 1.8 million ounces took gold through USD $1,240. Chinese interest was mixed, with early muted interest turning mildly bid and testing toward USD $1,245 before tailing off during the lunch break. Uncertainty surrounding political developments in the U.S. is likely to keep the greenback under pressure over the short-term and should support gold broadly around USD $1,235 - $1,240. Silver continued to claw back recent losses on Tuesday, pulling away from USD $16.50 to touch a USD $16.87 high late in New York trade. The bid tone continued during Asian trade today, however price action was generally restricted to pre-Tokyo trade to see the session high of USD $16.93 offered by both Japan and China. The grey metal looks likely to test USD $17 over the short-term and still has a lot of room to move considering the -13% decline (from mid-April highs) to a low of USD $16.08 printed only a week ago. Platinum continued Tuesday's uptrend during Asian trade today and with short positioning close to all-time highs the metal looks ready for a fresh test toward USD $1,000 should USD $950 break. Early interest in palladium during Asian trade today failed to break through USD $800 and the metal eased lower throughout the afternoon. Data releases today includes U.K. employment data and Eurozone CPI.

 

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