Posts Tagged gold
U.S. stock futures rise ahead of Bernanke testimony
Posted by Tetyana Matychak in Fund Markets on July 21st, 2010
U.S. stock futures rose on Wednesday, buoyed by Apple’s stronger-than-expected results, as investors braced for testimony by Federal Reserve Chairman Ben Bernanke and another barrage of earnings reports.
Nasdaq 100 futures gained 11.75 points to 1,851.50 and S&P 500 futures added 4.40 points to 1,084.50. Futures on the Dow Jones Industrial Average rose 31 points to 10,210. The Dow (DJIA 10,230, +75.53, +0.74%) ended up 0.7% on Tuesday, reversing intraday triple-digit
losses.
Sentiment was buoyed after Apple (AAPL 251.89, +6.31, +2.57%) reported last night a surge in earnings due to booming demand for its iPhone and iPad devices.
Strategists at Deutsche Bank said the spotlight Wednesday will be on Bernanke’s monetary policy report to the U.S. Senate Banking Committee.
“Expectations that Bernanke may announce policy accommodation measures seemed to help risk assets recover from the softer housing-starts data and Goldman Sachs’ earnings and revenue miss,” they wrote in a note. Markets will “likely listen carefully to decipher any hints about the possibility of a U.S. double-dip [recession].”
Bernanke will start speaking at 2 p.m. Eastern time, but before that investors will get a number of earnings reports from companies, including Morgan Stanley (MS 25.22, +0.44, +1.78%) , Wells Fargo & Co. (WFC 25.91, -0.11, -0.42%) and Freeport McMoRan Copper & Gold Inc. (FCX 64.32, +3.46, +5.69%) . Read the rest of this entry »
Be Wary the Rush to Gold
Posted by Tetyana Matychak in Banks on May 27th, 2010
Most of us have seen advertisements to buy gold or offering cash for gold. With the economy still unsettled and gold prices steadily rising, you may be tempted. But not all gold investments are safe.
On Tuesday, Representative Anthony D. Weiner, a Democrat from New York, attacked one company that is a gold and precious metals dealer, Goldline International Inc. He accused the company of “shady practices,” alleging that it overcharges for collector coins and provides misleading financial advice to consumers. “They’re exploiting the economy that we’re in,” he said.
Mr. Weiner also spoke of the company’s “unholy alliance” with television and radio personalities like Mike Huckabee, the former governor of Arkansas and Republican presidential candidate; and Fred Thompson, a former Senator from Tennessee and TV actor. But he particularly singled out Glenn Beck, the conservative talk show host.
“It’s debatable whether gold is a good investment,” Mr. Weiner said at a news conference in front of the Mercantile Exchange building in lower Manhattan. “There’s a confluence between a declining economy and the ignorance many consumers have about how the marketplace works.” Read the rest of this entry »
Europe’s Next Great Test
Posted by Tetyana Matychak in Business on March 29th, 2010
European leaders may have bought some time by backing in principle a bailout for Greece, but even if the money is handed over, it will be no silver bullet for Greece or for the euro zone.
That’s because the euro zone’s problems are not limited to Greece and not solely related to government debt and budget deficits.
Right now, Greece’s debt burden is unsustainable. With government debt equivalent to more than the country’s annual output and the government paying close to 6.5% to borrow money, Greece’s debt burden is not just growing but accelerating dangerously.
The best a bailout can do is to buy time to reduce those interest rates to give the government time to slash its deficits and set the debt on a downward path.
Yet it is the euro zone’s second challenge that is at once more widespread and more intractable. That is the euro zone’s competitiveness challenge: structurally weak economies, in southern Europe and elsewhere, locked by a common currency to Germany’s low inflation rate and economic stringency. Read the rest of this entry »
Gold Is in a ‘Bubble’ And Will Keep Going Higher: Gartman
Posted by Tetyana Matychak in Banks on November 18th, 2009
While not being comfortable with the current gold trade, Dennis Gartman, founder of The Gartman Letter, told CNBC Monday that the price of the precious metal will “continue to go up until it stops.”
“It is a gold bubble,” Gartman told CNBC. He called the trade on gold “mind boggling,” but also said he is currently long — or betting gold will go higher.
Gold hit a fresh record high above $1,130 an ounce early Monday as the dollar fell against other Western currencies.
Gold’s Friday low of $1,102 an ounce is the floor, according to Gartman. If it falls below that mark, he suggests investors should “head to the sidelines.”
The trend for the dollar is “still down” and will continue, Gartman said. It’s an “unbelievably crowded trade,” he added.
But any “correlation between a national currency and the stock market is negligible at best,” he said. Read the rest of this entry »
Gold strides onto record turf again
Posted by Tetyana Matychak in Banks on October 15th, 2009
Gold rallied to a intraday record Tuesday as the dollar slid to a 14-month low and investors remained concerned about the threat of inflation.
December gold was up $6.30 to $1,063 an ounce after climbing to a high of $1,069.70 earlier in the session. That topped the previous intraday record of $1,062.70 an ounce on Oct. 8.
Gold has been on a record-breaking run since prices rose firmly above $1,000 an ounce last month. Many analysts expect the rally to continue into next year.
“We’ve had a weakening dollar today which has definitely been supportive of gold prices,” said Carlos Sanchez, a precious metals analyst at New York-based CPM Group, adding that inflation is “a long-term concern” for many investors.
While prices could “taper off” following the current rally, “overall we still expect prices to head higher next year,” he added.
The market has been supported by speculation that the weak dollar will continue to depreciate as the U.S. budget deficit swells and investors flock to higher yielding currencies. Read the rest of this entry »
Watching those dollar correlations
Posted by Tetyana Matychak in Currency, Favourites on October 12th, 2009
The dollar’s decline — enough so far to trigger intervention from some Asian central banks — should dominate investors’ attention in the coming week if only because of the way it is so closely matched with other assets.
There was a near-perfect negative correlation between the dollar index .DXY, which tracks the greenback against a basket of major currencies, and world stocks as measured by MSCI .MIWD00000PUS in September and early October.
In other words, when the dollar was weak, global stocks nearly always rose, or vice versa.
While this link has eased a bit in the last week, it is still very strong — meaning that dollar-boosting comments such as those on Thursday from Federal Reserve chief Ben Bernanke still have a particularly strong spillover potential.
Bernanke reminded investors that the Fed had the tools at hand to pull back the flood of money it has released into the market — the so-called exit strategy — although it was not likely to act immediately.
Dollar weakness has also been behind the sharp rise in gold prices, which are now at record non-inflation adjusted highs well above $1,000 an ounce. Read the rest of this entry »
Gold stays above $920
Posted by Tetyana Matychak in Investing on June 26th, 2009
Gold steadied above $920 on Wednesday, off the previous session’s six-week low as traders awaited the outcome of a key Federal Reserve meeting on interest rates.
The precious metal bounced back from the six-week low of $912.90 as the dollar, the main driver of the current market, was hit by concerns that the Fed would reduce expectations of higher interest rates when it concludes its meeting on Wednesday.
Bullion, which has been sliding since failing to top $1,000 this month, is expected to trade within a narrow range on Wednesday ahead of the conclusion of the Fed’s meeting.
Traders said speculators clearing long positions and receding worries about inflation have pressured gold since it touched a three-month high of $989.80 in early June.
“The gold market’s waiting for material to trade on,” said Koji Suzuki, a senior analyst at SBI Futures Co Ltd. Read the rest of this entry »
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