Gold Spot Price Open: $1,268
Gold Spot Price Close: $1,280
Change in Gold Spot Price: +$12
Silver Spot Price Open: $17.14
Silver Spot Price Close: $17.30
Change in Silver Spot Price: +$0.16
Precious metals both made gains on Wednesday after an admittedly lackluster beginning of the week. When all was said and done, gold made more than 15 dollars while silver added more than 15 cents. Platinum and palladium gained on the day as well, both by more than 10 dollars apiece.
USD Index, Equities Weaker
Gold and silver bounced back on Wednesday after posting some poor numbers a day earlier. The main reason behind the positive day for gold and silver is the fact that the USD and US equities are mostly weaker on the day. Both of the aforementioned assets have been performing well through the early parts of this week, and today’s losses are mostly due to a corrective pullback after those gains.
Earlier in the week we were dealing with the fact that investors were looking at the ongoing Alberta wildfire as something that may limit the production of crude oil. This was exactly the case as it was reported that, over the past week or more, Canada was producing at least 1 million fewer barrels of crude oil per day as a result of the fire. Now that there is a strong belief that the fire is becoming controllable and not nearly as threatening, the upside support for crude oil as a result of the fire has since faded and now the worries are the same as they always have been. We are once again seeing investors harp on the fact that the global marketplace is more than oversupplied. Unless there is something done to limit the daily production of crude oil this is something that will continue to be the case.
The Dollar is lower today after hitting a near 2-week high earlier in the week, but this is nothing that investors are overly concerned about seeing as it is more of a corrective pullback more than anything else.
Bright Spot for Chinese Economic Data
It has been no secret that the Chinese economy has been struggling recently, but the large nation was given some good news early this morning in the form of a sales report on the sale of passenger vehicles. For a long time now, China has seen a decline in the sale of motor vehicles and that was something that really pointed to the overall economic struggles facing the nation. In April, however, some respite was offered thanks to sales of passenger vehicles jumping up more than 6% from what was recorded at this time a year ago.
A tax break that was recently instituted played a major role in the upbeat sales figures. Basically, the government is making it easier for average citizens to purchase vehicles; something that really helps boost economic growth. You see, larger purchases like those of motor vehicles resonate more than retail sales simply due to the disparity of price between retail goods and large items such as cars. Cars are more expensive, and as such an increase in the purchase of motor vehicles is almost always going to positively impact the economic outlook of a country more so than retail sales.
Now, all China needs is for other sectors to begin performing well and they will be on track to a full recovery. Still, however, the country is in a tough position and not performing up to par economically.
Wrap-Up
To put it simply, Wednesday was the slowest day of the week so far. There were very few fundamental changes offered to the global marketplace and, as such, the day was mostly negligible. Looking ahead to tomorrow, we are going to see investors focus their full attention on the weekly jobless claims report from the United States as it will be hawked over after last week’s sub-par report.
