Gold Spot Price Open: $1,308
Gold Spot Price Close: $1,312
Change in Gold Spot Price: +$4
Silver Spot Price Open: $20.07
Silver Spot Price Close: $20.00
Change in Silver Spot Price: -$0.07
Precious metals spent a majority of the day Thursday losing value as a result of a technical pullback after yesterday’s gains. When all was said and done, gold managed to hang on to gains of about 4 dollars while silver declined by little more than 5 cents. Platinum and palladium ended the day having made gains, but were down from daily highs.
New Sanctions From Russia
The sanction game has been continuously played by the US and European Union for the last couple of months. Almost every week, investors catch wind of more economic sanctions being levied against Russia by the West for Russia’s supposed involvement in the annexation of Crimea and continued support of pro-Russian rebels in Ukraine. Through economic pressure, the West is hoping that Russia will finally wise up and make a real effort to bring peace to the war-torn Eastern European country. Up to this point, however, sanctions have done little in the way of swaying how the Kremlin acts towards the situation in Ukraine.
As recently as yesterday, Russian president Vladimir Putin announced that his country is now ready to impose sanctions of its own upon members of the EU as well as the United States. Reported yesterday, the sanctions imposed by Russia will ban a large number of Western food products from entering the country. Though these new sanctions have yet to really have any impact on the market, it is a sign from the Russian government that they are not going to simply bow down to the commands of the West. As you could have guessed, the newly imposed sanctions by Russia only work to add more tensions to an already tense scenario. As we head into the last day of this week and into the weekend, it will be interesting to see how the EU and the United States react to Russia’s latest move.
Equities Hurt By Surging Safe-Haven Attitude
Despite precious metals conceding some value today due to profit-taking after yesterday’s gains, it is clear to see that the tide of the investing world is shifting a bit as we bring this week to a close. Over the last two days, European and US equities have been conceding a good amount of value as investors focus more readily on the violence and tensions in Ukraine. Just this week it was reported that Russia is building up a massive military presence along its border with Ukraine, made up of more than 20,000 combat-ready troops.
This news caused investors to grow a bit wary as it is looking more and more like Russia is going to involve itself in Ukraine’s civil war via direct military action. If Russian military action in Ukraine does come to fruition, something that is wholly unclear at this point, it is likely that precious metals will experience more days like the one we witnessed yesterday. John Manley, of Wells Fargo, put things into perspective when he was quoted as saying that “the uncertainty over the situation in Ukraine has overshadowed the positive economic data we saw earlier.” Simply put, as violence and tensions dominate the headlines, investors are going to focus on that much more than they will any economic data that is being made public.
The USD index was seen trading higher for yet another day today, and seems as though nothing can stop it. Though the greenback is down from daily highs, it is being helped along by continued focus on the situation in Ukraine as well as today’s ECB meeting, which will likely yield more news with regard to the ECB”s plans to keep monetary policy loose across the EU.
Wrap-Up
Looking ahead to the final day of the week, it is already shaping up like investors will continue focusing on the same factors they have been for the past few days. As is the case anytime uncertainty abounds, investors will want to find out tomorrow as much information as they can about the unfolding situation on the Ukraine-Russia border as that information will undoubtedly guide their investing decisions heading into the weekend. Should things stay the same from today in to tomorrow, however, I think precious metals may see another positive day to close out the week.
