Bullion Prices and Business Weekly Update – August 21, 2010

U.S. gold prices retreated $6.60 Friday, but the decline failed to stop its third straight week of gains. Gold peaked Thursday to a seven-week high as sour economic reports clouded the U.S. recovery picture, lifting safe-haven buying.

For a second consecutive week, however, silver, platinum and palladium each fell. Price drops include 0.7 percent for silver, 0.8 percent for platinum and 0.2 percent for palladium.

Crude oil on Friday finished down for a third day and for a second week. U.S. stocks moved lower as well, but the Nasdaq managed a modest weekly gain while the Dow and S&P marked two straight weeks of losses. European stocks marked weekly losses as well.

In U.S. precious metals futures prices, gold for December delivery closed to $1,228.80 an ounce, rising $12.20, or 1.0 percent, this week.

"Investors are looking for asset preservation, as they move back into gold as the overall outlook for U.S. economy starts to fade," Frank McGhee, head precious metals trader at Chicago-based Integrated Brokerage Services, said and was quoted on Reuters.

"The simplest formula is still likely to hold: economic contraction = asset liquidations = lower gold (but hopefully fewer percentage losses than other assets might sustain)," noted Jon Nadler, senior analyst at Kitco Metals, Inc. " Any time the word ‘hedge’ (or ‘reverse hedge’) can be used and appended to the word ‘gold’ the case for its core 10% presence in any prudent portfolio is an open and shut case."

Silver for September deliver closed to $17.991 an ounce, falling 33.6 cents. Friday’s drop was more than enough to push prices lower for the week, as it declined 11.8 cents.

Platinum for October delivery finished at $1,513.90 an ounce. It retreated $13.60 on Friday, taking away prior day gains and moving the metal down $12.30 for the week.

Palladium was in the same sinking boat. The September contract closed to $476.20 an ounce, declining $9.45 on Friday which resulted in a weekly loss of $1.05.

In London bullion prices, the gold Fix was $1,223.50 an ounce, rising $9.25, or 0.8 percent, for the week — although it fell $10 from its highest price point on Thursday.

"The slightly stronger dollar is weighing on gold," Walter de Wet, an analyst at Standard Bank Plc in London, was quoted on Bloomberg. "With gold above $1,220 an ounce, demand is slowing quite a bit" from physical buyers, he said.

In other weekly London precious metal prices, silver gained 8.0 cents, or 0.4 percent, to $18.140 an ounce. Platinum was $1,512.00 an ounce, declining $15.00, or 1.0 percent. Palladium was $478.00 an ounce, rising $5.00, or 1.1 percent.

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

London Fix Charts: Silver, Gold, Platinum and Palladium

(August 13 – 20)

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).

August London Fix Precious Metals Prices

Business News: Oil, Gasoline, and Stocks Prices

Crude oil prices returned "to a six-week low Friday, taking cues from a global equities sell-off that extended from Asia to the U.S. as worries deepened about the global recovery, and the dollar rose," wrote Claudia Assis of MarketWatch.

"Crude oil prices will remain under pressure due to continued poor weekly jobs data and related concerns over the state of the U.S. economic recovery," John Kilduff, a partner at Again Capital LLC, a New York-based hedge fund that focuses on energy, said and was quoted on Bloomberg. "Total petroleum inventory levels will also serve to limit gains and enhance losses."

U.S. crude oil for September delivery declined 97 cents, or 1.3 percent, to $73.46 a barrel. Oil prices fell $1.93, or 2.6 percent, this week after plummeting $5.31, or 6.6 percent, last week.

Prices at the pump fell six-tenths of a cent between Friday and Saturday. The national average for regular unleaded gasoline is $2.718 a gallon, according to the daily AAA fuel report. The price is 4.3 cents lower than last week, the same price as a month back, and 9.3 cents higher than a year ago.

U.S. stocks were split on Friday with weaker economic reports fueling tension over the pace of the recover and added to fears of a double-dip recession.

"When the area of great concern in the market place (jobs) gets a dismal report and the bright spot in the economy (manufacturing) gets whacked into oblivion, fear came back into the marketplace," Phil Flynn, a senior market analyst with PFG Best, said in a note to investors that was cited on CNNMoney.com. "Some call it the risk aversion trade but I say that’s a polite way of saying people are scared."

Friday closing figures for the three major U.S. indexes follow:

• The Dow declined 57.59 points, or 0.56 percent, to 10,213.62.

• The S&P fell 3.94 points, or 0.37 percent, to finish at 1,071.69.

• The NASDAQ edged up 0.81 points, or 0.04 percent, to 2,179.76.

For the week, the Dow declined 0.87 percent, the S&P 500 lost 0.70 percent, and the Nasdaq added 0.29 percent.

And in other world markets on Friday:

• The German DAX fell 69.97 points to 6,005.16.

• The Paris CAC 40 lost 46.28 points to end at 3,526.12.

• The London FTSE 100 retreated 16.01 points to 5,195.28.

For the week, the DAX fell 1.72 percent, the CAC 40 tumbled 2.35 percent and the FTSE 100 declined 1.52 percent.

How will next week fare for the markets? Upcoming events that will factor into performances are looked at in this Reuters video:

Bullion and Economic Articles

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

• 2010 America the Beautiful 5 oz Silver Bullion Coin Mintage
  Investors and coin collectors can expect a maximum mintage of 500,000 2010 America the Beautiful 5 oz Silver Bullion Coins, according to the U.S. Mint.

  With five coins set for production this year, that leaves each at 100,000 with an equal split — although specific levels have not been officially revealed as the Mint is in the process of seeking approval from the U.S. Secretary of the Treasury …

• US Bullion Coin Sales Sluggish
  The latest round of U.S. Mint sales figures contain the opening proof Platinum Eagle numbers, show a slowing demand for gold and silver bullion coins, and include several flat or negative product adjustments.

  Far fewer American Eagle and Buffalo bullion coins were ordered than typical between last Wednesday and Monday. Fractional Gold Eagles remained unchanged, and the 1 oz size and the Buffalo Gold coins each edged only 500 higher. Silver Eagles rose just 75,000 — less than the per day average sold during the first 230 days of this year…