Industrial metals, base metals and precious metals all took major falls over the last days. Gold tumbled to trade at 1246.20 declining almost $12.00 in the Asian session after tumbling from the 1275 range early on Wednesday. Silver followed on the heels of gold to trade at 19.810 down by 248 points. Platinum actual bucked the trend this morning adding $3.75 as traders took advantage of yesterday’s huge declines to buy up the precious metal on the cheap. Palladium remains at 713.20. Copper remained flat trading near recent lows at 3.148. Federal Reserve minutes seemed to upset the applecart on Wednesday evening as traders read too much into the minutes. Mr. Bernanke and Ms. Yellen have both been on the speaking circuits continuously saying that the Fed stimulus would continue into 2014, but traders reading the minutes have concluded that the Fed could begin to taper its huge monthly purchases regardless of the improvement in the jobs market. Metals should have and would have most likely rebounded this morning until the lackluster release of Chinese manufacturing sent metal traders running for the hills. China manufacturing growth fell to a two-month low as export orders swung to a decline, according to preliminary results from HSBC’s monthly PMI report issued this morning. The “flash” version of the HSBC/Markit China manufacturing Purchasing Managers’ Index eased to 50.4, compared to last month’s 50.9 reading. The result was also well below the official government version of the PMI, which hit 51.4 in October. Among the sub-indexes, new export orders slid below the 50 mark dividing growth from contraction, while overall new orders rose, but at a slower rate than in October. Traders pay more attention to the HSBC private data release as the official numbers are always suspicious and have been fixed in the past.
Gold is heading for a significant decline in 2014, Goldman Sachs Group Inc. said in a report yesterday that outlined investment themes for next year. Bullion may drop to $1,050 by the end of 2014, analysts including Jeffrey Currie wrote. Prices slumped 26 percent this year, heading for the first annual loss since 2000, amid expectations that the Fed will trim its $85 billion in monthly asset purchases as growth picks up. Policy makers expected data would signal further improvement in the labor market and “thus warrant trimming the pace of purchases in coming months,” according to minutes of the Fed’s October meeting released yesterday.
The Comex stopped trading in December gold futures for about 20 seconds yesterday after the December contract fell about $11 within a minute before trading was suspended.
There is little data for traders to look at today, so markets are expected to be quiet with Chinese and the Bank of Japan decision behind the markets. This morning the BoJ held rates and policy. The US dollar is trading at 81.21 while the JPY is trading right on the 100 price.