Gold and silver rode a sustained overnight rally into the New York opening bell this morning, barely off four-month highs hit in European trading. Gold is riding three weeks of gains.
Platinum is also up from Friday’s close, while palladium is essentially flat after a spike in London.
Several stories are clamoring for attention in international news this morning, each adding more or less to safe haven demand. The provisional government in Ukraine has issued an arrest warrant for ousted President Viktor Yanukovich, who is on the run in southern Ukraine. His plane was denied permission to travel to Russia over the weekend, and guards refused him entry into a presidential residence in the Crimea. The provisional government is appealing to the EU and IMF for immediate help to prevent a sovereign default on its loans, and is promising to make tough choices (such as reducing the heating oil subsidy) in order to right its fiscal ship.
Right behind this story is the news that Egypt’s military-backed government has suddenly resigned. This opens the way for new elections, as army Field Marshal al-Sisi prepares to run for President, evoking memories of the Sadat/Mubarak era of military-dominated governments.
Violence continues in Thailand, where protests have raged since November. Live ammo and grenades have been used by protestors and riot police against each other, as thousands demand the ouster of Prime Minister Yingluck Shinawatra. A bomb blast yesterday killed a woman and two children.
Venezuela is seeking a clampdown on media reaching the outside world regarding its own bloody protests. The situation there is becoming murkier, as pro-government rallies are competing with anti-government protests. At least eight people have died and hundreds injured, as the protests have ballooned from original demonstrations against food shortages and high crime.
Markets in Asia and Europe were a bit uneasy over evidence that banks in China are refusing to extend loans to commercial property developers, which is one of the most over-capacity economic sectors in the country next to coal and shipbuilding. This could be seen as a sign that banks are taking seriously the government’s admonitions to stop making loans to failing companies.
The news sent the yen higher, which caused the Nikkei to slip slightly from three-week highs. The Shanghai exchange was down 1.75%, and the Hang Seng lost 0.8%. Eurozone stocks also reacted negatively to the news, but the German Ifo business climate index helped them recover. The business sentiment index rose to 111.3 from 110.6, cheering investors.
Wall St. opened strong this morning,