Gold Makes Slight Gains as Markets Remain on Eurozone Watch

by Andrew Burger | May 25, 2012 12:26 pm

Gold was higher and silver slightly lower Friday morning as other EU members continue to press Germany to agree to the issuance of eurobonds backed by the collective credit capacity of its members at an EU summit in Brussels.

Spot gold was up 0.36% on the day thus far, bid at $1,563.40 an ounce. Prices reached as high as $1,571.60 and dropped as low as $1,556.60, according to Kitco market data[1]. The London afternoon reference price was set at $1,569.50, $1 an ounce above Thursday’s afternoon reference price.

Spot silver was showing a 0.11% loss, bid at $28.29 an ounce. The morning high as of time of writing was $28.63, with the low reaching $27.94. Friday’s reference price was set at $28.24, 16 cents an ounce higher than Thursday’s price fix.

Rumors that Germany is willing to compromise in its opposition[2] to the issuance of pan-EU, or euro, bonds continues to emanate and swirl out from an EU summit meeting in Brussels, which is lending support to the euro and risk assets. Italy PM Mario Monti said most of EU leaders support the issuance[3] of euro bonds as a means of addressing the region’s sovereign debt crisis and possible dissolution.

“Central banks internationally continue to diversify their foreign exchange reserves into gold bullion due to concerns about fiat currencies — including the dollar and especially the euro,” reports Dublin’s GoldCore[4]. “Central banks were again net buyers in April, with Turkey and Philippines being the largest buyers of gold,” according to GoldCore’s reporting of IMF data.

An interesting report in The Peru Times[5] states that $4 billion of a total $6 billion total of estimated money laundering in Peru flows from the illegal gold industry. Drug money laundering accounts for the remainder. It’s estimated that illegal mining produces 22% of Peru’s gold exports — worth $1.8 billion per year — with thousands employed in the process that’s resulting in large-scale environmental destruction.

Gold trusts were showing gains, but the iShares Silver Trust (NYSE:SLV[6]) was suffering small losses in U.S. stock exchange trading.

• The SPDR Gold Trust (NYSE:GLD[7]) was showing gains of around 0.25%.
• The iShares Gold Trust (NYSE:IAU[8]) was up around 0.25%.
• The iShares Silver Trust was down less than 0.1%.

Gold and silver mining ETFs were down or flat.

• The Market Vectors Gold Miners ETF (NYSE:GDX[9]) was showing losses of around 0.2%.
• The Market Vectors Junior Gold Miners ETF (NYSE:GDXJ[10]) was moving around flat line.
• The Global X Silver Miners ETF (NYSE:SIL[11]) was around 0.65% lower.

Gold mining shares were putting in a mixed performance thus far on Friday.

• Agnico-Eagle Mines (NYSE:AEM[12]) was down some 0.3%.
• Barrick Gold (NYSE:ABX[13]) was up around 0.2%.
• Eldorado Gold (NYSE:EGO[14]) was moving between small gains and losses.
• Goldcorp (NYSE:GG[15]) was up around 0.2%.
• Kinross Gold (NYSE:KGC[16]) was up some 0.6%.
• Newmont Mining (NYSE:NEM[17]) was showing losses of around 0.4%.
• NovaGold Resources (AMEX:NG[18]) was down around 0.1%.
• Yamana Gold (NYSE:AUY[19]) was up more than 0.9%.

Silver mining shares were mixed as well as the week’s trading was drawing to a close.

• Coeur d’Alene Mines (NYSE:CDE[20]) was up around 1.1%.
• Hecla Mining (NYSE:HL[21]) was some 0.5% higher.
• Pan American Silver (NASDAQ:PAAS[22]) was showing losses between 0.2% and nearly 0.4%.
• Silver Wheaton (NYSE:SLW[23]) was down around 0.75%.
• Silver Standard Resources (NASDAQ:SSRI[24]) was some 0.2%.

As of this writing, Andrew Burger did not hold a position in any of the aforementioned securities.

Source URL: https://investorplace.com/2012/05/gold-makes-slight-gains-as-markets-remain-on-eurozone-watch/

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