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MARKET REPORT
GOLD :-
Gold climbed for the week to end at 1287.60 after hitting a high of 1293.60 prompted by the testimony and statement by soon to be Chairwoman of the Federal Reserve. Global bullion demand tumbled 21% last quarter as investors pulled 118.7 metric tons out of ETFs and similar products, World Gold Council data show. The metal is still headed for its first annual loss since 2000 as equities rallied and inflation failed to accelerate after Federal Reserve purchases of assets in the debt markets to enhance its policy of easy credit. While gold is heading for its first annual drop in 13 years after some investors lost faith in the metal as a store of value, lower prices boosted jewelry, bar and coin purchases. Demand from China, India and the Middle East surged a combined 27% in the 12 months through September, the WGC estimates. Janet Yellen, the nominee to replace Bernanke in 2014 as chairman, said that the U.S. economy and job market are performing “far short of their potential” and she will ensure monetary stimulus isn’t removed too soon. She commented during testimony yesterday to the Senate Banking Committee in Washington. Bullion demand fell 21% to 868.5 tons in the third quarter, the WGC said on Friday.
GOLD WEEKLY CHART
SILVER
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Silver closed the week at 21.252 tumbling over 6% since Wednesday taking cues from gold as precious metal demand tumbled. Precious metals were locked up this week over the continued political wrangling in Washington over the U.S. government shutdown and the debt ceiling, and this will persist into next week, market watchers said. Thursday is the date when the Treasury has said it will run out of borrowing authority, which could mean it may default on some payments. Sentiment toward gold and silver was negative this week, with some banks like Goldman Sachs and Morgan Stanley giving bearish views on gold’s outlook.
SILVER WEEKLY CHART
CRUDE OIL
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Crude Oil ended the week on a down note closing at 93.89 after EIA data showed a jump in stocks while Brent Oil climbed over the week to trade at 108.36 with the gap widening to close to $15.00. China’s expansion will slow to 7.4% in 2014, the smallest gain since 1990, from 7.6% this year. That’s still higher than growth in the U.S., which is expected to accelerate to 2.6%, from 1.6% this year. Lower growth, lower production and increased supply and production of oil products pushed prices to trade at recent lows. Janet Yellen indicated she’ll press on with the Federal Reserve’s unprecedented monetary stimulus until she sees a robust recovery, downplaying risks the policy is inflating asset bubbles which supported prices this week. Crude oil opened at 94.70 touched a high of 95.38 to close the week almost $2 off the high. This week, the US Department of Energy announced what is being lauded as a major energy milestone: America, for the first time since 1995, has seen domestic oil production exceed crude oil imports.
NATURAL GAS
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Natural Gas closed the week on a positive note reaching 3.655 on Friday to ease to the close at 3.654 as cold weather blanketed the US for the first 13 days of this month. So far this month, November’s flows are 14% above flows for the same days in 2012. Although November demand has been slightly higher in 2013 than 2012, increased supply capacity has contributed to lower prices. Total consumption increased by 15.6% from the previous week, largely because of a 31.5% increase in residential and commercial consumption. Space heating demand increased as temperatures fell across much of the country and significantly colder-than-normal temperatures moved into the Northeast.
COPPER
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Copper fell to recent lows at 3.15 to close the week at 3.17. China unwrapped its boldest set of economic and social reforms in nearly three decades on Friday, relaxing its one-child policy and further freeing up markets in order to put the world’s second-largest economy on a more stable footing. Comex copper futures were trading on a negative bias this week is not only a worrisome clue for the red metal, but it’s also a bearish signal for the entire raw commodity sector. December Comex copper futures prices this week dropped sharply and hit a three-month low. A bearish downside technical “breakout” occurred on the daily chart for the copper futures market, to suggest still more downside price pressure in the near term. Monthly continuation chart for nearby Comex copper futures that prices have been trending lower for nearly three years and are on the verge of a downside breakout below key longer-term chart support at the $3.00 level. The fact copper prices dropped sharply this week are an early warning signal that construction activity worldwide could be flagging.
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