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    JM Bullion Gold and Silver Market Update (11/4/14)

    Posted on November 04, 2014


    Gold Spot Price Open: $1,173

    Gold Spot Price Close: $1,170

    Change in Gold Spot Price: -$3

    Silver Spot Price Open: $16.24

    Silver Spot Price Close: $16.08

    Change in Silver Spot Price: -$0.16

    Precious metals had a somewhat mixed day, but by the time US markets closed it was clear to see that the selling pressure has not really gone anywhere. When all was said and done, gold lost about three dollars while spot silver was down by more than 15 cents. Platinum lost a little over 1 dollar, but palladium finished the day more than ten dollars weaker.

    Crude Oil Continues to Hurt Precious Metals

    Lining up with the expectations of experts, the value of crude oil only continues to drop, bringing most raw commodities–including precious metals–down too. As it stands, the value of crude oil is in the neighborhood of $75/barrel, meaning oil is now hovering around a two-year low. This slide, coupled with the fact that the Dollar has performed extremely well in recent weeks, has made for a market atmosphere that does not lend itself to appreciating precious metals spot values.

    Even with the USD Index trending downward to open up this week, gold and silver could not find the traction they need to make any gains. The European Central Bank meeting is scheduled to take place this Thursday, and with many experts and analysts expecting the ECB to announce fresh stimulus measures, it is looking more and more like the greenback will have another strong week.

    European Economic Data Paints Grim Picture

    In the lead-up to this week’s ECB meeting, you will see that, much like last week, many investors are holding their positions in order to see what, if anything the ECB does with regard to monetary policy. Through economic data that was made public today, some more credence may be lent to the belief that the ECB is on the verge of announcing fresh stimulus measures this week.

    Before US markets opened, it was reported that the European Commission had reduced its growth expectations for the Eurozone during 2015. In the report, growth forecasts for the EU for 2015 dropped from 1.7% (which was predicted last May) to 1.1%. Though the ECB has resisted committing to out and out quantitative easing, it is thought that this is the week where that mindset will change. After the Bank of Japan announced fresh injections of cash into the Japanese economy just this past week, it is widely believed that the ECB will do the same this week, or, if nothing else, at some point before the year’s end.

    Stocks Fall on Political Uncertainty, Declining Energy Shares

    In the United States, Tuesday is the day where Governors, Congressmen, and other political leaders are up for election and, in some cases, re-election. In addition to this, the Presidential midterm elections are also taking place today, making this a very important day for the political landscape of the United States. As is often the case on massive political days such as this, investors have become a bit more risk-averse or are simply holding their positions and awaiting the outcome of key elections. Because of all this uncertainty abounding across the US marketplace, it should come as no surprise that stock indexes were moving mostly downward today.

    Not helping equities at all is the massive decline of energy shares upon hearing how crude oil prices continue to slide. A growing belief is that a potential nuclear deal may be reached in Iran, and if this happens and sanctions are lifted, Iranian oil will soon be flooding the marketplace. At present, most European and Western countries refuse to purchase Iranian oil, so if a deal is reached in the forthcoming days and weeks, crude oil may continue to trend lower and lower for the foreseeable future. Of course, we will continue to keep a close eye on anything and everything happening in and around the crude oil market.


    Though today was definitely still on the slower side of things, it is clear to see that this week is gaining momentum. Come tomorrow, you will see widespread reaction to the early election results as well as a wider number of investors gearing up for Thursday’s European Central Bank meeting. I anticipate that the next three days will bring about a lot of investing activity as well as plenty of happenings and data for investors to mull over and react to.

    All Market Updates are provided as a third party analysis and do not necessarily reflect the explicit views of JM Bullion Inc. and should not be construed as financial advice.