The precious metal markets were rebounding from Monday’s losses during this morning’s trading session. Spot gold was up almost $5 per ounce to trade just shy of $1,250/oz.
Spot silver added 5¢ to move back to $16.63/oz while platinum posted modest gains. Palladium continued its odd trend of moving inversely to the other precious metals, losing about 0.6%.
Here are yesterday’s closing numbers for the metals, along with crude oil and the U.S. dollar:
Gold: $1,244.50/oz (-$12.10, -0.96%)
Silver: $16.58/oz (-10¢, -0.63%)
Platinum: $915/oz (-$13, -1.40%)
Palladium: $866/oz (+$13, +1.52%)
WTI: $43.49/bbl (+48¢, +1.12%)
DXY (dollar index): 97.41 (+0.19%)
The brief “flash crash” of 1.8 million ounces (roughly 56 metric tonnes) of gold futures being sold in a matter of 10 minutes yesterday morning (amid low volumes) remains a bit of a mystery. It has been suggested that human error could be involved, as 1,800 ounces would be a rather normal trade but 1,800 lots of 1,000 oz each would match the size of the unusual order. This could’ve been a mistake made by an inexperienced trader. Meanwhile, 1,337 metric tonnes of silver also changed hands during the upheaval.
Stocks in the U.S. were mixed on Monday. The Dow Jones and S&P 500 were each less than 0.1% above unchanged, while the tech-heavy Nasdaq index lost about 0.3%. Futures pointed slightly lower again on both sides of the Atlantic on Tuesday, although shares were higher in most major Asian markets overnight. Treasurys eased up slightly, sending 10-year yields up to 2.17%.
The markets closely followed this morning’s conference held by the European Central Bank (ECB) in Portugal. ECB President Mario Draghi commented on the pending “unwind” of the central bank’s heavily bloated balance sheet, signaling a gradual end to aggressive economic stimulus, or quantitative easing, in Europe. This has not coincidentally arisen just as investors are taking a more hopeful outlook on Europe’s economic future. In response to Draghi’s comments, the euro jumped 1% to nearly $1.13. Accordingly, the U.S. dollar was almost 0.7% lower on the DXY index to 96.75, a three-week low.
For those who follow central banks, Tuesday is a busy day indeed. In addition to Draghi, the Bank of England’s Mark Carney as well as Fed Chair Janet Yellen will be speaking publicly today. Tomorrow, the Fed also conducts its annual “stress test” of the country’s banks.
This may take some of the attention off of the healthcare battle in Congress. Legislators have declared a self-imposed deadline of Friday for the Obamacare repeal-and-replace bill (known as the American Health Care Act, or AHCA) to be finalized and voted on. However, there is no real penalty or repercussion if the debate carries past the Friday deadline.
The big market news this morning was actually the culmination of an ongoing dispute between the European Commission and tech giant Google. The company best known for its popular search engine is being fined a record $2.7 billion by the EC under its antitrust rules. Essentially, regulators are charging Google with favoring its own services and advertising through search results. The decision will now be appealed to Europe’s highest courts.
In another interesting note, businesses appear to be signaling their growing confidence in the economy as the pace of initial public offerings (IPOs) is currently about double what it was at this point last year.
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