Bullion & Business Weekend Report – Oct. 31

Precious metals retreated on the week as prices fell following a stronger US dollar. New York crude oil dropped the most in a month on Friday, yet still managed an October rise of 9 percent. US stocks also declined sharply Friday to mark their worst one-day slide since April. The Dow, S&P and Nasdaq registered respective weekly losses of 2.6 percent, 4.0 percent, and 5.1 percent. European stocks declined as well.

In London bullion weekly figures, gold fell 2.0 percent, silver shot down 6.1 percent and platinum retreated 3.8 percent. Friday precious metals prices follow:

London silver closed to $16.57 an ounce, plummeting $1.08 from last Friday’s close. New York December silver futures ended at $16.255 for a $1.47 weekly plunge.

London gold was fixed at $1,040.00 an ounce for a $21.75 loss on the week. New York gold for December delivery finished at $1,040.40 for a weekly decline of $16.00.

London platinum ended at $1,320.00 an ounce, falling $52.00 since last Friday’s close. New York platinum for January delivery ended at $1,326.30 for a $43.20 weekly retreat.

"If it appears that the dollar can strengthen, it can lead stocks down, and gold is going to slip," Frank McGhee, the head dealer at Integrated Brokerage Services LLC in Chicago," was quoted on Bloomberg.com. "Gold is just following moves in the dollar," McGhee said. The decline "could bode poorly for next week," he added.

"The market seems to have moved in this direction and, despite the [dollar] rally, bullish sentiment remains strong [for gold],” Merrill analyst Gustavo Soares wrote in a note indicating confidence in gold’s eventual rise to $1,500 an ounce "due to increased credit risk, dollar weakness and commodity strength," as stated on MarketWatch.com.

"It will also be interesting to see if FOMC members [next week] wear hawk or dove costumes to their own party," wrote Jon Nadler, Sr. analyst at Kitco Metals Inc. "For now, that kind of costuming is what makes for other masks also being worn on The Street – the bear or bull kind."

Gold, considered a hedge during times of high inflation and economic uncertainty, tends to follow oil and move opposite to the U.S. dollar. A rising greenback makes dollar-denominated commodities, like bullion, more expensive for holders of other world currencies.

To follow are silver, gold and platinum performance charts, oil news, week-ending world stock summaries, and precious metal article summaries for the week.

London Fix Charts: Silver, Gold and Platinum
(Oct 23 – 30)

The London Fix is one of the most used bullion quotes around the world. The London AM fix for gold and platinum begins at 10:30am GMT (5:30am in New York), and the PM fix begins at 3pm GMT (10am in New York). The London Fix for silver begins each business day at 12pm GMT (7am in New York).

London Fix figures: percent and dollar changes*

Weekly World Business News: Oil, Gasoline, and Stocks Prices

Crude oil plunged Friday after the Commerce Department reported that US consumer spending dropped sharply in September, and for the first time in five months. Household spending dropped by $47.2B, or 0.5 percent, after a revised 1.4 percent increase in August.

New York oil for December delivery declined $2.87, or 3.6 percent, to close at $77.00 a barrel. For the week, oil dropped 5.2 percent. However, oil futures still gained 9 percent in October.

"People are still antsy that this will be a tepid recovery," Chip Hodge, who oversees a $9 billion natural- resource bond portfolio as senior managing director at MFC Global Investment Management in Boston, was quoted on Bloomberg. "Given where the economy is, $80 oil doesn’t make a hell of a lot of sense."

Prices at the pump declined one-tenth of a cent between Friday and Saturday. The national average for unleaded gasoline was $2.694 a gallon, according to a AAA fuel report. The price is 4 cents higher than last week, 22.5 cents more than a month back, and 19 cents less than a year ago.

U.S. stocks fell sharply Friday "with Bank of America, JPMorgan Chase and Alcoa leading the Dow Jones Industrial Average’s components lower as investors again grew concerned about the economy after the short-lived excitement over Thursday’s good report on gross domestic product," wrote Donna Kardos of MarketWatch.

"I think the run has just gotten tired," Ron Kiddoo, chief investment officer at Cozad Asset Management, was quoted on CNNMoney.com "A lot of people who wanted to get in over the last two months have done that, so maybe we need to sell off more to get more people back in."

As a recap for weekly losses, the Dow declined 2.6 percent, the S&P fell 4.0 percent, and the Nasdaq retreated 5.1 percent.

Friday figures for the three major US indexes follow:

• The Dow plummeted 249.85 points to close at 9,712.73.

• The S&P dropped 29.92 points, closing at 1,036.19.

• The NASDAQ fell 52.44 points to finish at 2,045.11.

And in other world markets, indexes recorded weekly gains but ended mixed on Friday as the following figures show:

• The German DAX dropped 172.49 points to close at 5,414.96.

• The Paris CAC 40 fell 106.33 points, to close at 3,607.69.

• And the London FTSE 100 shed 93.17 points to finish at 5,044.55.

U.S. stocks tumbled on Friday — closing lower for the week and the month as well, after two somber consumer reports shook confidence in the economic recovery. Conway Gittens of Reuters reports on this, world stocks and other business news in the following video. Sound bite is Head Economist, Michael Dueker of Russell Investments.

Bullion and Business Articles

In related silver and gold news, interesting or quick-read articles from the week include:

• Gold falls on U.S. data, but still up nearly 4% in October – MarketWatch
  Gold futures finished lower on Friday, but held on to strong gains in October, as a firmer dollar and mixed U.S. economic reports dimmed the metal’s appeal as a hedge against inflation. The U.S. government reported consumer spending fell sharply in September, while employment costs rose …

• Gold Falls, Capping First Weekly Loss in Five, as Dollar Gains – Bloomberg
  Gold fell, capping the first weekly loss since late last month, as a strengthening U.S. dollar cut demand for the precious metal as an alternative asset. Investment in the SPDR Gold Trust, the biggest exchange- traded fund backed by bullion, slipped 0.3 percent this week as the dollar rebounded from …

• GDP: Great Day to Play – Jon Nadler, Kitco
  Friday’s market sessions in precious metals started off on a tamer note, following the best gains in gold in three weeks. Explanations follow. The recapture of the $1045 area is noteworthy, although analysts we polled during the wee hours overseas are trying to define the move as everything from a …

• US Mint Bullion Coin Sales Robust – CoinNews
  US Mint collector coins moved like molasses when compared to sales figures of two weeks ago. But bullion coins — especially gold — still had a little swagger in their step. October will be a robust month for American Eagles and American Buffalos. UHR Double Eagles took a significant hit, rising sadly by only 562. Since they …

• First Spouse Gold Coin Sales Slip – First Spouse Coins
  Sales retreated again for the beautiful 24-karat First Spouse Gold Coins. In fact, the total unit increase for the seven day period was less than half of what it was in the prior report. Sarah Polk Proofs still led the First Spouse series by adding 79, but both Anna Harrison Proofs and Letitia Tyler Proofs lost …

• US Silver Coins Cool, Bullion Eagles Near 23M – Silver Coins Today
  US Mint sales numbers are often mixed when it comes to silver related collector products — demand for coins in one hand rise while those in the other decline, metaphorically speaking. October has been different. Silver coins have trended up or down as a group without the mixing. Last week’s report was filled with strong, bullish numbers. This week’s numbers are …

• US Bullion Gold Buffalo Coins Top 110K – CoinNews
  The United States Mint has sold 110,500 one-ounce American Buffalo $50 Gold Bullion Coins since they were released on Thursday, Oct. 15, 2009. To place that in perspective, in less than two weeks bullion dealers have purchased 64.2 percent of the total (172,000) that was sold in all of 2008 …

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