Precious metals prices were weaker yesterday and were down an average of 1.3 percent with the palladium price off 2.6 percent at $758, gold and palladium were down one percent at $1,292.70 and $1,397 and the silver price was off 0.5 percent at $19.71.
Precious metals are up slightly this morning with platinum and silver up 0.5 percent at $1,404.40 and $19.80, while the gold price is up 0.2 percent at $1,295.15 and palladium is up 0.1 percent at $758.90. The fact silver declined the least yesterday and is relatively stronger this morning, may well suggests some bargain hunting is coming into silver, so we will watch the gold / silver ratio to see if that starts to fall.
Equities – the Euro Stoxx 50 closed up 0.1 percent and the Dow finished down less that 0.1 percent yesterday, but a stronger tone is being seen in Asia this morning with the Nikkei up 0.5 percent, the Hang Seng is up 0.8 percent, the Kospi is up 0.2 percent and China’s CSI is up 0.1 percent. The markets still seem to be focused on the headwinds from China and Ukraine.
Currencies – the dollar index is edging higher, last at 80.12, a move up through the 80.20-80.30 level would look constructive. Conversely the euro is looking heavy, last at 1.3741, sterling looks like it may edge higher from the 1.6610 area, the aussie continues to climb, last at 0.9264, while the yen consolidates around 102.15 and the yuan around 6.2100.
The economic agenda is busy today, late last night a host of Japanese data came out including: household spending, CPI, unemployment and retail sales and it was a mixed bag, especially the 2.5 percent fall in household spending – see table below. UK GfK consumer confidence came in at minus 5, which was an improvement on the previous minus 7 reading and later we get German CPI and import prices, French consumer spending, various UK data including a final reading on GDP and then in the US we get data on personal spending, income, inflation and revisions to consumer spending and inflation expectations.
Gold found some support around the $1,289 area, which happened to be where the former neckline of the inverse head and shoulder formation was. Prices are getting some lift now, so we wait to see how much bargain hunting materialises. Generally we thought prices did need to have a meaningful correction when they were stretching away from the uptrend line in early March, the correction has been deeper than we expected, but has not turned us bearish. We wait to see how the market now handles this pull-back. Silver also seems to have found some support and we wait to see if the correction in the PGMs has run its course too.
|Average (BM ex-Steel)||0.5%||5,589|
|11:30pm||Japan||Household Spending y/y||-2.5%||0.2%||1.1%|
|11:30pm||Japan||Tokyo Core CPI y/y||1.0%||0.9%||0.9%|
|11:30pm||Japan||National Core CPI y/y||1.3%||1.3%||1.3%|
|11:50pm||Japan||Retail Sales y/y||3.6%||3.4%||4.4%|
|12:05am||UK||GfK Consumer Confidence||-5||-6||-7|
|12:20am||USD||FOMC Member Tarullo Speaks|
|7:00am||Germany||German Import Prices m/m||0.3%||-0.1%|
|All Day||Germany||German Prelim CPI m/m||0.4%||0.5%|
|7:45am||France||French Consumer Spending m/m||1.0%||-2.1%|
|9:30am||UK||Final GDP q/q||0.7%||0.7%|
|9:30am||UK||Index of Services 3m/3m||0.6%||0.8%|
|9:30am||UK||Revised Business Investment q/q||2.4%||2.4%|
|Tentative||Italy||Italian 10-y Bond Auction||3.42|1.6|
|12:30pm||US||Core PCE Price Index m/m||0.1%||0.1%|
|12:30pm||US||Personal Spending m/m||0.3%||0.4%|
|12:30pm||US||Personal Income m/m||0.4%||0.3%|
|1:55pm||US||Revised UoM Consumer Sentiment||80.6||79.9|
|1:55pm||USD||Revised UoM Inflation Expectations||3.20%|