Gold saw early support in Asia to start the week, then caught a small bounce on the London open. A short-covering blip on the COMEX open in New York saw everyone’s yellow metal peek above the $1,305 mark briefly, before settling down a few dollars.
Silver followed basically the same trajectory, and is up modestly the morning in New York.
Platinum saw a nice jump in early European trading, and is hanging on to that moderate gain in slightly choppy trading. Palladium is just above unchanged.
U.S. Treasuries are still seeing strong demand, with the yield on the 10-year note at 2.5%, still near a six-month low. Traders are getting antsy in the stock market, with the S&P 500 recording back to back weekly declines, despite inching up to new records earlier in the week.
Asian markets are down, and the Chinese government announces another crackdown on the “shadow lending” market. This moved bank shares lower in Shanghai and Hong Kong, and lend safe haven support to the Japanese yen. That strong yen hurt Japanese exporters, dragging the Nikkei index down.
European stocks are also lower, as news that a mega-merger in the pharmaceutical industry fell through. Lackluster economic news has traders pulling out of Greek, Italian, and Spanish bonds.
Money is moving out of equities, because no one wants to be caught holding the bag of “financial instruments” this time around, or holding shares of funds that own these derivatives and other instruments.
Gold has been in a really tight range for over a month, and might break out soon. As the Modi government gets installed in India next month, there could be an early, slight change in the existing gold import restrictions do show that the new government is following through on its pro-business promises. Gold is building a safe haven demand completely independent of Ukraine, as risk-off sentiment grows in the equity and European bond markets.
Retail silver demand shows no sign of abating, as the U.S. Mint reports that 20.7 million 2014 American Silver Eagles have already been sold through the first two weeks of May. Will we see another world record for Silver Eagle sales this year, after 2013’s huge 42.5 million? It might end up depending on whether the Mint can keep up.