Stock Market Watch

Gold Prices Drift Towards $1,300 an Ounce; Silver Prices Fall Sharply

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Gold prices were heading towards a sharply lower close on Wednesday as the dollar turned broadly higher amid news reports that President Obama was likely to nominate Janet Yellen as the Silver prices also fell sharply in trading on Wednesday.

Ms. Yellen is known to keep a very “dovish” stance on monetary policy, and her appointment raises the possibility that the Fed might not hurriedly pull back its economic stimulating measures, which will be supportive for the U.S. economy along with the dollar.

At last check, gold futures for December delivery plunged 1.59% to $1,303.60 an ounce while spot gold lost 0.85% to $1,307.05 an ounce.

The SPDR Gold Trust (ETF) (NYSE: GLD) was last down 1.01% to $126.11

The looming policy stalemate in Washington (debt-ceiling and budget cut issues) also failed to encourage investors to take bets in safe-haven assets such as gold, probably signaling that market participants are anticipating an eleventh-hour deal over the debt-ceiling issue.

“There doesn’t seem to have been much interest triggered as a result of this situation in the United States, and the market has struggled to maintain any headway,” said Simon Weeks, head of precious metals at ScotiaMocatta, according to Reuters.

“There has to be a view that the situation is eventually going to be resolved,” added Weeks.

Besides, lack of economic data releases have also kept bullion investors clueless, prompting them to stay in sidelines.

Earlier today (During Asian trading hours), the metal held its ground but failure to cross its next key resistance level of $1,336 an ounce triggered sell-off. The metal has traded in tight range of $1,300 to $1,330 in last five sessions.

Silver futures tumbled 2.17% to $21.95 an ounce.

In late trading, the iShares Silver Trust (ETF) (NYSE: SLV) was down 1.44%, and the ProShares Ultra Silver (ETF) (NYSE: AGQ) was down 2.79%.








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edliston
Post Written By: Ed Liston

Ed Liston is a senior contributing editor at TheStockMarketWatch.com. An active market watcher and investor, Ed guides an independent team of experienced analysts and writes for multiple stock trader publications. He is widely quoted in various financial publications on the Internet. When Ed is not writing about stocks, investing in stocks, talking about stocks, or otherwise doing something stock related, he likes to go sailing and fishing in his yacht.

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Ed Liston

Ed Liston is a senior contributing editor at TheStockMarketWatch.com. An active market watcher and investor, Ed guides an independent team of experienced analysts and writes for multiple stock trader publications. He is widely quoted in various financial publications on the Internet. When Ed is not writing about stocks, investing in stocks, talking about stocks, or otherwise doing something stock related, he likes to go sailing and fishing.

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