Gold: In the London market, gold fell further on January 23 as the euro slid to session lows versus the dollar, with signs of improving global economy, after strong euro area economic figures, capping investors’ interest in the metal. Spot gold fell 0.2 per cent to $1,688 an ounce.
A day earlier, the London market, gold held near $1690 an ounce kept in check by tough chart resistance, as stock markets steadied ahead of earnings reports from key tech companies and the euro surrendered gains against the dollar.
While the precious metal benefited in early trade from weakness in the US unit versus the euro after a positive reading of German investors sentiment, it struggled to breach its 55-day moving average at $1,694 an ounce. Spot gold was at $1,689.34 an ounce, while US gold futures for February delivery were up 0.2 per cent to $1,689.80 an ounce.
Gold prices are little changed from the start of the year after posting their worst quarterly performance in more than four years in the last three months of 2012. Gold stalled below $1,700 an ounce in early January and has struggled to break through resistance at $1,690-1,695 in the last four sessions, frustrating buyers. In earlier trade the metal also took some support from the Bank of Japan’s announcement that from 2014 it would adopt an open-ended commitment to buy assets.
On the physical side of the market, India more than doubled the import day on gold dore bars and ores, hard on the heels of a hike in taxes on refined gold. Dore, an alloy of gold and silver used by refineries, accounts for about 100 tonnes or about 12 per cent of India’s annual imports. The government is trying to dampen demand in the world’s biggest bullion consumer, whose imports total around 800 tonnes a year, and rein in a record current account deficit.
In other precious metals, silver is expected to recover to an average price of $32.85 an ounce in 2013 from last year’s decline to $31.13, before picking up to $33.50 next year. Analysts predicted an average palladium price of $745 an ounce from 2013, 16 per cent above last year’s average of $641 an ounce and an average $1,700 an ounce for platinum, up 10 per cent from 2012’s average $1,546.
In the Singapore market, gold held near a one month high on January 22, but faces a strong resistance at $1700 an ounce, as it struggles to attract fresh buying from investors who opted for riskier assets against the backdrop of a global economic recovery. A rosier global economic outlook based on recent upbeat data from the United States, China and even Europe, has triggered rallies in equities and precious metals with industrial applications, including silver, platinum and palladium, putting gold in the shadow.
Spot gold was little changed at $1692.60 n ounce. It hit a one month high of $1695.76 in the previous session after the Bank of Japan announced bold stimulus measures in an attempt to revive the anaemic economy. The SPDR Gold Trust, the world’s top gold ETF, saw an outflow of nearly 15 tonnes so far this year.
Meanwhile Tokyo gold hit a record high on January 21, after the Bank of Japan, took bold steps to stimulate the economy. The BoJ announced its most determined effort yet to end years of economic stagnation, saying it would switch to an open ended commitment to buying assets next year and doubling its inflation target to two per cent.
Newmont Mining Corp said that its sales and production of gold are expected to decline in the fourth quarter compared with the previous year. For the fourth quarter, Newmont expects its total attributable gold production to reach 1.3 million ounces, down four per cent from the year-ago period. Looking ahead to 2013, the company expects attributable gold production of 4.8 million to 5.1 million ounces. By comparison, the company said that it expects full-year 2012 gold production of five million ounces. Newmont, the world’s second-biggest gold producer after Barrick Gold Corp. had seen solid revenue growth in recent quarters amid a decade-long surge in the price of the precious metal. But the company reported last month its third-quarter earnings fell 26 per cent as revenue slipped 9.6 per cent amid lower output for gold and copper and higher expenses.
In the New York market Brent crude futures edged up and US crude dipped on January 23 in choppy trading as improving British employment data lent support, while a lower economic growth forecast from the IMF limited gains. Offering surprise support to oil were figures showing British unemployment fell for the 10th consecutive quarter at the end of last year and that jobless claims hit their lowest level since mid-2011 in December. Brent March crude was up 27 cents at $112.69 a barrel.
In the New York market, oil prices rose on January 22, supported by Bank of Japan plans for asset buying and strong investor confidence data from Germany that boosted the outlook for fuel demand. News that the BOJ would switch to an open-ended commitment to buying assets next year and double its inflation target to help end years of economic stagnation gave crude an early lift. Optimism increased following a surprisingly strong German ZEW reading on investor sentiment, a sign the euro zone crisis was no longer hitting Europe’s largest economy as hard as it did last year. Further support came from gains in the US stock market after the Dow and the Standard & Poor’s 500 indexes closed at five-year highs on January 18.
Brent March crude rose 71 cents to settle at $112.42 a barrel. The US February crude contract, which expired at the settlement, gained 68 cents to settle at $96.24 a barrel. The more heavily traded March crude rose 64 cents to settle at $96.68 a barrel. Brent trading volumes were heavy, up 17 per cent over the 30-day moving average at the close, while US volumes were closer to normal levels.
Brent’s premium to US crude narrowed slightly to $15.77 a barrel, following news the governor of Nebraska had approved a revised route for the Keystone XL pipeline that would send Canadian crude to refineries in Texas and help clear growing inventories of crude in the Midwest that has depressed US oil futures.
In the Singapore market, Brent crude held above $112 a barrel on January 22 supported by a brighter outlook for the global economy while investors awaited inventory data from the United States for clues about demand in the world’s largest oil consumer.
Appetite for riskier assets was buoyed by Bank of Japan’s plans to shore up the world’s third largest economy and strong investor confidence data from Germany. These added to upbeat economic data from the top two economies, United States and China, earlier this month.
Brent crude edged down 22 cents to $112.20 a barrel US crude for March was at $96.59, down nine cents, after hitting a four-month high of $96.90 earlier in the session.
In the London market copper fell on January 23, dragged lower by indication of a well-supplied market amid higher output from mining groups such as BHP Billiton and signs of subdued demand from top consumer China.
Three-month copper on the London Metal Exchange ended at $8,103 a ton, down from a day earlier close of $8,133 a ton, and slipping back from a two-and-a-half week high of $8,154.25 hit in intraday trade. BHP, the world’s biggest mining group, released its quarterly report on January 23 showing five per cent higher copper output and forecast the world’s biggest copper mine would step up production by a fifth this year.
Also weighing on the price was recent data from China that showed high domestic copper production and analysts estimate more than one million tonnes of copper are sitting in bonded warehouses in the world’s biggest copper consumer.
Copper declined from the highest level in more than a week as China’s output of refined metal climbed to a record. Metal for delivery in three months dropped as much as 0.4 per cent to $8,098 a metric ton on the London Metal Exchange before trading at $8,103.75. Copper climbed to $8,144.50 on January 22, the highest since January 11. Futures for delivery in May on the Shanghai Futures Exchange lost 0.3 per cent to 58,720 yuan ($9,438) a ton.
Refined copper production jumped 22 per cent in December from a year ago to 580,000 tonnes, data from the National Bureau of Statistics showed. Total output in 2012 rose 11 per cent to 6.06 million tonnes, said the bureau.BHP Billiton Limited (BHP) said copper production at its Escondida mine in Chile jumped 31 per cent from a year earlier to 161,500 tonnes in the three months ended December 31. The world’s largest mining company said the increase will help to meet its target for a 20 per cent increase in copper output from the mine in fiscal 2013.