Posted on August 31, 2015
Gold Spot Price Open: $1,136
Gold Spot Price Close: $1,137
Change in Gold Spot Price: +$1
Silver Spot Price Open: $14.64
Silver Spot Price Close: $14.70
Change in Silver Spot Price: +$0.06
Precious metals began the day by conceding value, but things turned around at roughly midday to make Monday a somewhat forgettable day of trading. When all was said and done, gold ended the day having added a single dollar, while silver managed to add a few pennies. Platinum and palladium finished the day having posted mixed results, with palladium picking up more than fifteen dollars while platinum lost nearly ten.
For the last few weeks, the price of crude oil has bounced around a lot. Today, we witnessed the commodity partake in a nice rally which saw it finish the day in fine standing. As one of the leading commodities, crude oil’s upbeat performance today prompted spot values to pare early losses and finish the first day of the week having their value left almost unchanged. Since hitting a 6-year low of less than $40/barrel last week, crude oil has bounced back nicely and seems to have established a market bottom around the $37/barrel price point.
Still, with worries regarding China’s economic stability still abounding, there is no saying what the future holds for crude oil and thus all commodities. This is especially true when you consider the possibility of Iranian crude oil being sold in Western markets should previous nuclear negotiation deals be finalized. It will be important for precious metals to keep close tabs on the price action of crude oil, because oil’s movement directly influences that of gold and silver.
China’s Shanghai Index fell by roughly 1% today as it was reported that China’s central bank would not be purchasing domestic shares. In fact, reports released today indicate that China is on the verge of entirely backing away from its intervention in the stock market as things clearly did not pan out the way they were expected to. As opposed to helping stabilize the stock market in China and around the world, Chinese government involvement has instead acted to make economic and financial conditions in the country much more unpredictable than before. Thanks to this continued turmoil in China, US stocks also had a fairly poor day on the last trading day of August.
Moving forward, it will be interesting to see what happens to global stocks thanks to China’s pullback from purchasing Chinese stocks. After having dropped more than 1% today, however, the next four days are going to be a real test for Chinese investors and anyone else who may have a vested interest in the country’s financial market.
Over the weekend saw members of the FOMC meet for a scheduled symposium in Jackson Hole, Wyoming, but that symposium provided investors nothing of use as it relates to more information regarding rate hikes. Still, the investing world is left guessing as to when they think the ignition will be started on rate hikes. As we head further into this week, the eyes of the investing world will be on global stock markets as they come to terms with China’s decision to avoid intervening in the equity market. In addition to all of this, you can expect a healthy slate of economic data from the month of August. As interest rate hikes remain a key topic of discussion, any and all economic data will be hawked over closely.