Posted on January 27, 2015
Gold Spot Price Open: $1,282
Gold Spot Price Close: $1,295
Change in Gold Spot Price: +$13
Silver Spot Price Open: $18.02
Silver Spot Price Close: $18.14
Change in Silver Spot Price: +$0.12
Precious metals were able to recover some of yesterday’s losses today thanks to some poor corporate earnings reports from US companies. When all was said and done, gold gained more than ten dollars while silver managed to add little more than 10 cents. Platinum and palladium both gained today as well, with gains ranging between 7 and 13 dollars.
The biggest event catching the attention of investors both today and this week is the large number of fourth-quarter earnings reports expected to be released from US corporations. The fourth-quarter is often considered to be the most important of the fiscal year, so investors tend to put a lot of weight into what these figures say.
Much to the surprise of almost everyone, corporate earnings reports published today ended up being on the weaker side of things. For Caterpillar, a slowdown on the part of some major mines across the globe saw profits trickle in as opposed to the large influx of money that was expected. Microsoft saw poor retail sales hurt its bottom line while Proctor & Gamble suffered from a higher valued US Dollar devaluing some overseas earnings. Thanks to today’s poor data, stocks sold off at a rapid pace and are set to post the biggest single-day losses we have seen in more than 3 months.
According to Dan Greenhaus, chief strategist at BTIG, “At first blush, this is a terrible report and we’ll have to go back and revise our Q4 GDP estimate. The odds of GDP printing 3.5 percent or more for the fifth quarter in the last six are now virtually nil.”
The rest of this week will see some more earnings reports be made public, so it will be interesting to see if there is a change in tone or not. As it stands now, investors are especially skeptical with regard to the overall stability of global stock markets.
January’s Federal Open Market Committee meeting kicked off today and is set to wrap up sometime tomorrow late morning or early afternoon. As has been the case for the past 6 or more months, investors will be looking to the meeting as well as the post-meeting statement for any clues regarding the future of interest rates here in the United States. Of course, with the way things have gone recently, with falling crude oil prices, most investors have become convinced that interest rates in the United States will remain at current levels until sometime in early 2016.
Despite the fact that this week was always expected to be slow, things through the first two days have been indicative of a quite active marketplace. With a plethora of corporate earnings reports still needing to be published, you can bet that things will remain active throughout the course of the week. Of course, the FOMC meeting is taking place too, but at this point very few people are expecting it to be a source of any groundbreaking or shocking news. Finally, in addition to all of this, it will be interesting to see how European stocks react as Greece’s new government moves closer to abandoning their current austerity measures. This is something we will continue to keep a close eye on as the week, month, and year play out.