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    JM Bullion Gold and Silver Market Update (7/29/14)

    Posted on July 29, 2014


    Gold Spot Price Open: $1,303

    Gold Spot Price Close: $1,301

    Change in Gold Spot Price: -$2

    Silver Spot Price Open: $20.58

    Silver Spot Price Close: $20.66

    Change in Silver Spot Price: +$0.08

    After posting some small gains during the first half of the day, precious metals began to slide and ended the day having suffered some small losses or posting negligible gains. When all was said and done, gold lost about two dollars while silver managed to gain about 8 cents. Platinum and palladium also fared somewhat poorly today, having recorded marginal losses.

    US Equities Fluctuate, End Up Making Gains

    Before US markets officially opened today, equities here were seen losing value as a result of more economic sanctions being levied against Russian banks and businesses. In an agreement reached by EU representatives in Brussels this week, Russian banks are barred from selling shares or bonds in EU nations and are restricted from exporting equipment meant to modernize the oil industry. The latter of the two restrictions is believed to be the one that will hurt the Russian economy the most. As a result of these new sanctions, the market played host to some keener risk-aversion throughout much of the morning. By the afternoon, however, better than expected earnings reverted early morning losses and saw US equity markets begin making decent gains.

    Shedding some light on the reason behind why US stocks continue to perform well despite ongoing political tensions with Russia was Dan Veru of Palisade Capital Management, when he was quoted as saying, “Geopolitical risk remains a risk, but let’s look at what’s happening that’s good. What ultimately makes stocks go higher is earning and earnings are supporting higher valuations in the market.” In other words, so long as the US economy continues to improve, equity markets will more than likely improve right alongside it.

    US Dollar Continues to Gain Against Euro

    Since the beginning of this month, the US Dollar has made continuous gains against the euro currency. As the Fed is expected tomorrow to announce yet another reduction to their Quantitative Easing bond-buying initiative, the US Dollar only stands to gain more strength. While the US Federal Reserve has been tightening monetary policy for the past few months, the European Central Bank has been pursuing measures to the contrary. As such, the euro currency is expected to continue losing value through the remainder of this year and perhaps even beyond that.

    China’s Pollution Battle Expected to Push Palladium Even Higher

    Despite the fact that most every palladium mine strike in South Africa has since been resolved and nearly 5,000 more ounces of the metal will be available for consumption in the coming months, there are still lingering supply worries. The reason for this is due to the sanctions being placed on Russian businesses by Western nations as well as China’s increasing demand for the metal.

    Seeing as how China is now the world’s largest auto market, the gasoline vehicles which are sold there will account for a large portion of the palladium shipped and consumed worldwide. Palladium is used in vehicles as a means of reducing emissions, and due to increasing environmental standards in China the need for palladium in vehicles is only expected to grow. As more hands begin grasping for an increasingly limited supply of the metal, most analysts are expecting the spot values of both palladium and platinum to continue to grow.


    As we look ahead to tomorrow, you can expect things to be a good bit busier than they were today. The reason for this is not only due to the plethora of US economic activity the market will be paying attention to, but also the continue geopolitical scenarios which are unfolding around the world. For this being a week in the middle of summer, the market is uncharacteristically abuzz with activity.

    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.