Gold Spot Price Open: $1,214
Gold Spot Price Close: $1,192
Change in Gold Spot Price: -$22
Silver Spot Price Open: $17.07
Silver Spot Price Close: $16.86
Change in Silver Spot Price: -$0.21
Gold and silver ended the week in dismal fashion as a direct result of today’s US Labor Department Employment report. When all was said and done, gold declined by more than 20 dollars while silver fell by more than 20 cents. Platinum and palladium also suffered noticeable losses to close out the 5-day trading week.
Employment Data Handily Bests Market Expectations
The big news of the week came today in the form of the most recent US Labor Department employment report. Prior to markets opening today, experts and investors alike were expecting to hear of at least 215,000 new jobs being added to the US economy last month. With recent weeks’ economic data being as poor as it has been in the US, however, there were some people who were skeptical about whether or not the data would live up to expectations. Surprisingly, the report was made public during the morning hours of today and showed that nearly 250,000 new jobs were created in September. As you could have probably guessed, this news drove the value of precious metals downward by considerable margins. Now, as of the writing of this post, the spot value of gold is sitting below the $1,200 threshold while silver’s spot value has fallen below $17.
In addition to precious metals suffering marked losses, the USD Index and all major US equity markets showed significant improvement. In fact, the USD Index alone jumped upward by nearly 1.5% on the day. According to Richard Schlanger, of Boston-based Pioneer Investments, “The Fed has to feel we’re making progress and it’s time for them to consider tightening. The market doesn’t seem to be concerned about inflation.” As we look ahead to next week, I anticipate that we will continue to see delayed reactions to today’s US employment report.
Developments In the Situation In Hong Kong
For most of this week, we have been reporting with regard to the unrest that is taking place in Hong Kong. In case you were unaware, protesters in the financial capital of the world have been taking to the streets for more than a week now in order to protest a lack of democratic reforms. In essence, the people of Hong Kong (which is technically referred to as a Special Administrative Region of China) fear that their government is on the verge of becoming as restrictive as that of mainland China.
Just today, however, tensions in the city have calmed down significantly upon the news that top city officials have agreed to meet the protesters demand with regard to governmental and electoral reforms. Despite this supposed agreement, some of the remaining protesters were seen clashing with police. While there were clashes today, the entire situation seems to be calming down quite significantly. This is good news not only for the traffic-stricken city of Hong Kong, but also for equity markets around the world that were seen suffering due to the unrest.
Wrap-Up
Though this week was fairly quiet and subdued, the last few days have brought with them quite a bit of economic activity. We have seen investors in the US and Europe, to an extent, react to today’s employment report, but come Monday, I expect we will see some investors from Asia and Europe digest the news that they received after markets had already closed for the day in that part of the world. In all, most people will not be very surprised to see precious metals spot values decline even further by the time next week rolls around.
