Bullion & Business Weekend Report – March 13, 2010

Precious metals were mixed for the second week of March after rallying broadly during the first. Gold declined the most, suffering a near $30 weekly collapse in London while briefly dropping below $1100 an ounce in New York — that, following a $1135 close last Friday.

Platinum was a standout, pulled higher in part by world reports of stronger auto sales figures. The metal is used to make catalytic converters for vehicles.

New York crude oil remained above $81 a barrel but did decline a modest 26 cents this week. In stocks, major indexes in the U.S. and Europe finished higher for the second straight week.

In weekly New York metals prices, April gold declined $33.50, or 3.0 percent, to end at $1,101.70 an ounce. Silver for May delivery finished at $17.048 an ounce, falling 33.4 cents, or 1.9 percent. April platinum advanced $29.30, or 1.9 percent, to close at $1,608.40 an ounce.

"With further indications that China could accelerate monetary tightening, as inflation in China has risen, gold demand may wane," Walter de Wet, an analyst at Standard Bank Plc in London, said on Bloomberg in an article stating that 9 of 19 investors/traders/analysts surveyed believed bullion would drop next week. "Of all the metals, we find that gold is the most sensitive to liquidity and interest rates."

In weekly London bullion prices, gold was fixed to $1,106.25 an ounce, falling $28.75, or 2.5 percent. Silver gained 6 cents, or 0.3 percent, to $17.31 an ounce. Platinum settled at $1,619.00 an ounce, jumping $41.00, or 2.6 percent.

"The focus right now is mainly on the stock market, and it is a rarity that gold is down with a falling dollar. At some point, I foresee this relationship will go back to normal," Jeff Pritchard, analyst at California-based broker-dealer Altavest, said on Reuters.

Recent action "once again shows to what extent gold has taken on risk asset attributes and that it has lately traded in tandem with such — normally thought to go in the opposite direction — other assets as stocks for example," wrote Jon Nadler, senior analyst at Kitco Metals, Inc.

Included below is a video entitled "Gold Bulls’ Curious Excuse." MarketWatch summary: After rallying nearly $100 in two months, gold gave up nearly half those gains, taking many gold bugs by surprise. MarketWatch’s Mark Hulbert talks about the arguments they used to excuse gold’s weakness.

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

London Fix Charts: Silver, Gold and Platinum

(March 5-12)

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 Precious Metals Prices

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

Oil prices declined Friday, "as a report that showed U.S. consumers were less upbeat in March offset a forecast for higher global oil demand and an unexpected rise in U.S. retail sales in February," wrote Polya Lesova and Nick Godt of MarketWatch.

"The consumer confidence number and looking at the revision to January of the retail sales pulled crude back down," Richard Ilczyszyn, senior market strategist at Lind-Waldock in Chicago, said on Reuters.

New York crude-oil for April delivery declined 87 cents, or 1 percent, to close to $81.24 a barrel. The price is 0.3 percent lower than last week when oil reached its highest level since January 11.

Prices at the pump rose a half penny between Friday and Saturday. The national average for regular unleaded gasoline is $2.788 a gallon, according to a AAA fuel report. The price is 5.2 cents higher than last week, 15.2 cents more than a month back, and 86.6 cents above that of a year ago.

U.S. stocks moved narrowly on Friday,"as investors welcomed a report that showed a surprise rise in retail sales, but showed caution as the Dow, Nasdaq and S&P 500 lingered below 18-month highs," wrote Alexandra Twin of CNNMoney.com.

"It looks like confidence is beginning to wane," Michael Mullaney, who manages $9 billion at Fiduciary Trust Co. in Boston, said on Bloomberg. "Confidence is going to suffer until we get real improvement on the jobs front. In addition, the stock market is a little bit extended right now. A minor pullback wouldn’t be surprising."

For the week, the Dow edged 0.55 percent higher, the S&P rose 1 percent and the Nasdaq climbed 1.78 percent.

Friday closing figures for the three major US indexes follow:

• The Dow gained 12.85 points to close at 10,624.69.

• The S&P lost 0.25 point to finish at 1,149.99.

• The NASDAQ slipped 0.80 point to end at 2,367.66.

And in other world markets:

• The German DAX rose 16.48 points to close at 5,945.11.

• The Paris CAC 40 declined 1.55 points to close at 3,927.40.

• The London FTSE 100 gained 8.39 points to finish at 5,625.65.

For the week, the DAX gained 1.2 percent, the CAC 40 advanced 0.4 percent and the FTSE 100 rose 0.5 percent.

Bullion and Business Articles

In related bullion, business and United States Mint news, interesting or quick-read articles from the week include:

• The Blame Locker – Jon Nadler, Kitco Metals Inc.
  Spot gold bullion prices rose overnight, having once again tested the (and held at) the just-under $1100 level yesterday — a fresh, three-week low. Dollar weakness ahead of the release of US economic data this morning kept bullion specs interested, however an early push towards the $1120 resistance area was truncated and the metal retreated towards $1110, and then even lower, turning negative within the first hour of trading, as the US dollar pared losses incurred immediately following the release of US retail sales figures for February.

  Spot dealings started the week’s final session with a $6.90 gain in gold, at an $1116.50 bid quote per ounce, as against a fairly hefty 0.49 slip in the US dollar on the trade-weighted index (to 79.79 at last check) and tracking a half-dollar gain in crude oil (now at $82.66 pbbl.). The International Energy Agency earlier hiked its estimated global oil demand for 2010 for a second month and that sparked a near 1% surge in black gold futures. In any case, this morning’s action once again shows to what extent gold has taken on risk asset attributes and that it has lately traded in tandem with such –normally thought to go in the opposite direction- other assets as stocks for example. Anything for an additional buck …

• US Bullion Coin Sales Rebound, Disabled Vet $1s Advance
  2009 Buffalo Gold Proof Coin activity has declined now for three straight weeks. Since Jan. 31, weekly gains moved from 1,327, to 771, then to 413, and now to 384. Total sales have reached 48,396.

  As suggested in last week’s report, interest in bullion coins picked up during the prior seven days. America Gold Eagles rose by 25,500 versus 16,000. American Silver Eagles advanced 750,000 compared to 425,000. If the pace is maintained for both through the remaining days of this month, Gold Eagles would have their third best March ever while Silver Eagles would enjoy their best March …