Morning Market Update: Jan 10

January 10th, 2013 by

Precious metals are soaring in morning trading in New York, as stocks open higher and the dollar plummets.  Overnight news from overseas has lifted expectations of economic improvement, while a depressing jobless claims report in the U.S. this morning made the dollar less attractive.

China reported that exports surged a surprising 14.1% in December, compared to 2.9% in November, fueling perceptions that the Chinese economy has hit bottom and is recovering. In Europe, the ECB and Bank of England both decided to leave interest rates alone, as the latest Spanish bond auction went better than expected. This news has lifted the euro versus the dollar. Brent crude futures hit a 3-month high overnight, and are still trading up in New York on expectations of global economic improvement.

Platinum and palladium are once again outpacing gold and silver on the prospect of rising auto sales and industrial activity. Platinum has closed its gap to spot gold to the $50 range. Speaking of ranges, gold and silver have been trading in a narrow range since December. The market today bears watching to see if the impetus precious metals are receiving will be the event that breaks them out of that range. The bears have been holding the advantage in gold and silver lately, but may have pushed prices as far as they are going to go in the near term.

by David Peterson