21 May 2019 — Tuesday
YESTERDAY in GOLD, SILVER, PLATINUM and PALLADIUM
The gold price certainly didn’t do much on Monday. The low tick, such as it was came at, or shortly after the morning gold fix in London — and the high, such as it was, came shortly after the 11 a.m. EDT London close. The price didn’t do much after that — and the low and high ticks certainly aren’t worth looking up.
Gold finished the Monday session at $1,277.30 spot, up 20 cents on the day. Net volume was exceedingly light at a bit under 163,000 contracts — and there was a hair under 50,000 contracts worth of roll-over/switch volume on top of that.
Silver was up a penny or three in morning trading in the Far East on their Monday — and the down/up price spikes minutes before 2 p.m. China Standard Time, was only in the spot month. From there it edged sideways until 1 p.m. BST/8 a.m. EDT — and chopped quietly higher by a nickel or so by 3 p.m. in the thinly-traded after-hours market. It didn’t do a whole lot after that.
The low and high ticks in this precious metal aren’t worth looking up, either.
Silver finished the day at $14.435 spot, up 5.5 cents from Friday’s close. Net volume in this precious metal was very light as well at just over 41,500 contracts. Roll-over/switch volume was a bit over 3,100 contracts.
The platinum price was up 6 bucks by shortly after 9 a.m. China Standard Time on their Monday morning — and then didn’t do much of anything until 10 a.m. Central European Summer Time. It was sold down to its low of the day — and a new low for this move down, which came a few minutes after 9 a.m. in New York. It then rallied back about five bucks or by minutes after the Zurich close. It was sold a bit lower over the next hour or so — and then didn’t do much for the rest of the day. Platinum was closed at $813 spot, down 3 bucks from Friday.
The palladium price traded aimlessly sideways in all of Far East — and most of Zurich trading on their respective Mondays. After a particularly vicious down/up spike minutes after 9 a.m. in New York, it headed higher until around 11:30 a.m. EDT. It crawled a bit lower until trading ended at 5:00 p.m. Palladium finished the Monday session at $1,314 spot, up 17 dollars on the day.
The dollar index closed very late on Friday afternoon in New York at 97.995 — and dipped about 5 basis points once trading began at 5 p.m. EDT on Sunday. The 98.03 high tick came around 1:20 p.m. China Standard Time on their Monday afternoon — and its 97.88 low tick was set about 11:35 a.m. in New York. From that juncture it chopped quietly higher into the close from there. The dollar index finished the Monday session at 97.93…down about 7 basis points from its close on Friday.
Here’s the daily DXY chart from the folks over at the ino.com Internet site, as I got home too late in the day on Monday to pick up the Bloomberg chart, as it had already changed over to the Tuesday trading session, which began at 7:44 p.m. EDT yesterday evening/7:44 a.m. CST in Shanghai on their Tuesday morning. The ‘click to enlarge’ feature does not help with this graph.
Here’s the 6-month U.S. dollar index chart from the folks over at the stockcharts.com Internet site — and the delta between its close…97.76…and the close on the DXY chart above, was 17 basis points on Monday. Click to enlarge.
The gold shares opened a bit below unchanged on Monday morning in New York trading — and then wandered around either side of unchanged for the rest of the day…in the green in the morning — and in the red in afternoon trading. The HUI closed lower by 0.48 percent.
The silver equities looked like they were trading on another Planet. They also opened down a bit, but kept right on going, closing on their lows of the day, as Nick Laird’s Intraday Silver Sentiment/Silver 7 Index closed down a hefty 2.54 percent. Click to enlarge if necessary.
And here’s Nick’s 1-year Silver Sentiment/Silver 7 Index chart, updated with Monday’s doji. Click to enlarge as well.
Pan American Silver was down a bunch yesterday, as was Coeur Mining. Hecla got smoked for 7.89 percent. I didn’t have time to see if there was any specific news on any of them. Maybe the short sellers are back once again.
The CME Daily Delivery Report showed that 15 gold and 13 silver contracts were posted for delivery within the COMEX-approved depositories on Wednesday.
In gold, ADM and Advantage issued 8 and 7 contracts — and the only two long/stoppers that mattered were JPMorgan and Advantage, with 8 and 6 contracts. All contracts, both issued and stopped, involved their respective client accounts.
In silver, ADM issued 12 — and Advantage issued 1 contract…all from their respective client accounts. Of the three long/stoppers in total, JPMorgan picked up 10 contracts…8 for clients — and 2 for its own account. Advantage stopped 2 for its client account.
The link to yesterday’s Issuers and Stoppers Report is here.
The CME Preliminary Report for the Monday trading session showed that gold open interest in May rose by 6 contracts, leaving 73 still around, minus the 15 contracts mentioned a few paragraphs ago. Friday’s Daily Delivery Report showed that only 1 gold contract was posted for delivery today, so that means that 6+1=7 more gold contracts were just added to the May delivery month. Silver o.i. in May declined by 60 contracts, leaving 227 still open, minus the 13 contracts mentioned a few paragraph ago. Friday’s Daily Delivery Report showed that 49 silver contracts were actually posted for delivery today, so that means that 60-49=11 silver contracts vanished from the May delivery month.
There were no reported changes in either GLD or SLV on Monday.
Over at Switzerland’s Zürcher Kantonalbank, they updated their gold and silver ETFs as of the close of business on Friday, May 17 — and this is what they had to report. Both ETFs declined by smallish amount, as their gold ETF dropped by only 1,703 troy ounces — and their silver ETF by 13,985 troy ounces.
There was a sales report from the U.S. Mint on Monday. They sold 2,000 troy ounces of gold eagles — 2,000 one-ounce 24K gold buffaloes — and 546,000 silver eagles. They also reported their first sales of the ‘America the Beautiful’ 5 oz. silver rounds…74,000 of them, or 370,000 troy ounces.
There was no in/out movement in gold over at the COMEX-approved gold depositories on the U.S. east coast on Friday.
There was decent activity in silver, as 597,082 troy ounces, one truckload, was received — and all of that ended up at Loomis International. There was 783,090 troy ounces shipped out. The largest amount, one truckload…617,669 troy ounces…departed CNT. The remainder…105,092 troy ounces…and 60,328 troy ounces…departed Brink’s, Inc. and Canada’s Scotiabank respectively. There was was also a paper transfer of 118,009 troy ounces from the Eligible category and into Registered over at CNT — and I would suspect that this amount will be delivered in May. The link to all this, is here.
There was a bit of activity over at the COMEX-approved gold kilobar depositories in Hong Kong on their Friday. There were 280 reported received — and 200 kilobars shipped out. Except for the 180 kilobars deposited at Loomis International, all the other in/out activity was at Brink’s, Inc. The link to that, in troy ounces, is here.
Since yesterday was the 20th of the month — and it fell on a weekday, the good folks over at The Central Bank of the Russian Federation updated their website with April’s data. It showed that they added 500,000 troy ounces/15.55 metric tonnes of gold to their reserves that month.
That brings their total gold holdings up to the 70.2 million troy ounce/2,183.4 metric tonne mark. Here’s Nick’s most excellent chart showing that change. Click to enlarge.
I have an average number of stories for you today.
Ford Motor Co. plans to eliminate about 7,000 salaried jobs — about 10% of its global white-collar workforce — as pressures mount on automakers to keep pace with massive technological shifts amid signs global car demand has peaked.
Eliminating the positions will save Ford about $600 million a year, Chief Executive Officer Jim Hackett wrote in a memo to employees Monday, seven months after the company informed employees of a salaried workforce “redesign.” The majority of the cuts will be completed by May 24 in North America, and by the end of August in markets including Europe, China and South America.
“To succeed in our competitive industry, and position Ford to win in a fast-changing future, we must reduce bureaucracy, empower managers, speed decision making, focus on the most valuable work, and cut costs,” Hackett wrote. “Ford is a family company and saying goodbye to colleagues is difficult and emotional.”
The dismissals are designed to shrink Ford’s management structure by 20% and streamline the number of organizational layers to nine or less, from 14, Hackett said. The number of jobs cut is far less drastic than the 25,000 that a Morgan Stanley analyst predicted last year.
This Bloomberg article from early on Monday morning EDT is something I found in Tuesday’s edition of the King Report. Another link to it is here.
Here we go again — just as tensions seemed to be calming going into the weekend, with Trump distancing himself from some of the more out-front escalatory rhetoric from hawks like Bolton within his own administration last Friday, leave it to who else but Senator Lindsey Graham to ramp things up again. “We must deliver an overwhelming military response,” he tweeted in reference to Iran.
Following Saudi claims last week that Iran was behind a Houthi drone attack out of Yemen which targeted an ARAMCO pumping station and pipeline, and after the alleged “sabotage” attack on Saudi and other tankers near the Strait of Hormuz, Graham said early Monday it was “clear” that Iran has “attacked pipelines and ships of other nations” over the past weeks.
Interestingly, again we find Bolton pushing this narrative, per Graham’s tweet: “Just received a briefing from National Security Advisor Bolton about escalating tensions with Iran. It is clear that over the last several weeks Iran has attacked pipelines and ships of other nations and created threat streams against American interests in Iraq.”
And further appearing to acknowledge President Trump’s reluctance to let the hawks drag him into yet another useless and futile regime change war in the Middle East, Graham urged, “Stand firm Mr. President“.
So now it appears the hawks are waging a full frontal assault to goad the president into war, as even a statement from Iran’s foreign minister acknowledged earlier in the day.
This story put in an appearance on the Zero Hedge website at 12:32 p.m. on Monday afternoon EDT — and I thank Brad Robertson for pointing it out. Another link to it is here.
President Donald Trump claimed this week that he does not want war with Iran. If he really believes this, the president ought to look into what his subordinates are doing.
Among their bellicose actions are deployment of the ‘Abraham Lincoln CVN-72’ carrier task force to the coast of Iran, massing a strike package of B-52 heavy bombers in Qatar, just across the Gulf from Iran, positioning more U.S. warplanes around Iran, readying a massive cyber attack against Iran, and trying to stop the export of Iranian oil, upon which its economy depends.
Plus repeated attempts to overthrow the government in Tehran – something the U.S. already did very skillfully in 1953.
If all this is not war, according to Trump, then what is? It’s war by another name. Just what the U.S. did to Cuba, Iraq, Sudan, North Korea, Nicaragua, Syria, and, since 1979, Iran. Like a shark, the U.S. warfare state has to keep moving. So it finds threats popping up all over.
The latest alleged grave ‘threat’ to America’s security was an ancient wooden dhow. Spotted by U.S. satellites, this decrepit old sail-powered tub was claimed by Washington war promoters, led by the enragé John Bolton, to be carrying Iranian missiles. What unbelievable rubbish.
This rather brief, but very worthwhile commentary from Eric was posted on the unz.com Internet site on Saturday sometime — and it comes to us courtesy of Larry Galearis. Another link to it is here.
With its hoped-for merger with Commerzbank in ruins, and the future of its investment bank uncertain, Deutsche Bank shares tumbled to a new all-time low on Monday after an analyst at UBS downgraded DB shares to a sell with a price target of €5.70 ($6.40) – that’s the second-lowest price target on Wall Street.
After Monday’s selloff, shares aren’t far from that level. Click to enlarge.
UBS analysts led by Daniele Brupbacher wrote that operating conditions for Germany’s biggest lender are expected to remain “difficult” and its strategic options are “limited.” The bank remains vulnerable to “external events.”
They also cut EPS estimates for 2020 to 2022 by 25%, 18% and 12% respectively, based on lower revenue assumptions.
The above four paragraphs and chart are all there is to this tiny Zero Hedge story that Brad Robertson sent our way yesterday. It showed up there at 7:06 a.m. EDT on Monday morning — and another link to it is here.
Europe is finally coming to its senses five years after the coup in Kiev started what is now the new Cold War between Russia and the West.
The first part of Russia’s win comes from Italian leader Matteo Salvini. Speaking for the under-represented in European politics, Salvini declared this week, “I continue to believe that we don’t need sanctions. The issue of their removal unites all decent people.“
Salvini is tackling, head-on, the European political establishment in this week’s European parliamentary elections. And his raising the issue of lifting sanctions on Russia imposed over the reunification with Crimea is a massive attack on them.
It means that Salvini is looking at using the extension of sanctions as a bargaining chip this summer. He is threatening to veto any extension with words this strong on the eve of an election.
The second victory for Russia, however, is far more significant. The Council of Europe has finally agreed to restore Russia’s voting rights after suspending them over the unification with Crimea.
This was a major bone of contention between Europe and Russia, who suspended their budget payments to the CoE in 2017. The deadline for dealing with their non-payment was coming up next month.
This very worthwhile commentary from Tom was something I found embedded in a Zero Hedge article very early on Monday morning — and it comes courtesy of Brad Robertson as well. Another link to it is here.
Ukraine’s president, Volodymyr Zelenskiy, took the oath of office on Monday and immediately announced plans to dissolve parliament, setting up a clash between the country’s entrenched political class and its new leader.
Zelenskiy, a comedian with no prior political experience, won a landslide victory in elections last month, amid anger over corruption and a grinding war with Russian-backed separatists in the country’s south-east.
In a fiery inauguration speech on Monday, he called on government ministers to resign and urged officials not to idolise the president.
“I don’t want my portraits to hang in your offices,” Zelenskiy said. “Because the president is not an icon or an idol. Hang pictures of your children there and look them in the eyes before every decision.”
By calling snap elections, Zelenskiy hopes to quickly extend his political momentum to the legislature and sweep out loyalists to the former president Petro Poroshenko. Zelenskiy’s new party, Servant of the People, would win about 40% of the votes in a parliamentary election, according to recent polls.
This is very encouraging. Let’s hope that he doesn’t die of ‘lead poisoning’ in the process. I thank Dave Stirling for sending us this news story from theguardian.com Internet site yesterday. It was posted on their website at 9:40 a.m. BST on their Monday morning, which was 4:40 a.m. EDT in Washington — EDT plus 5 hours. Another link to it is here. Then there was with parallel story from Zero Hedge at 2:45 a.m. EDT this morning headlined “Ukraine’s Comedian-Turned-President Vows “First Task” is to “End War In Donbass“”
Recently, an eminent gold advisor, whom I know and have a high regard for, stated that holders of precious metals would be well served by keeping their metals in a remote location, saying, “Distance equals security.” (He lives in the U.S. and recommends storage in New Zealand, as it’s as far away from him as possible.)
Another prominent metals advisor, whom I also know well and respect, contacted me after the release of this statement to say that he doesn’t necessarily agree with the idea, even though he himself stores gold in a country outside his own.
So, what’s the real answer? Is the investor better off keeping his metals as close to home as possible or as far away as possible?
Well, the answer should not be defined by distance at all. It should be defined by accessibility and safety.
This worthwhile commentary be Jeff appeared on the internationalman.com Internet site on Monday morning EDT sometime — and another link to it is here.
In his “Frank Talk” column today, U.S. Global Investors CEO Frank Holmes previews his recent interview with GATA secretary/treasurer Chris Powell about manipulation of the gold market, which is scheduled to be published in his column next week.
It was posted on the usfunds.com Internet site last Friday — and another link to it is here.
Russia’s finance ministry said on Monday gold production in Russia between January and March this year rose to 58.12 tonnes, up from 51.61 tonnes during the same period the previous year.
Production for the period included 45.95 tonnes of mined gold compared with 39.78 tonnes a year ago, the ministry said.
Silver production during the first three months of this year was down compared to the same period in 2018, slipping to 223.28 tonnes from 250.76 tonnes, the finance ministry said in its statement.
The above three paragraphs are all there is to this tiny Reuters article, filed from Moscow, that put in an appearance on the kitco.com Internet site on Monday. Another link to it is here.
Back in April of 2018, when the trade war with China was still in its early stages, we explained that among the five “nuclear” options Beijing has to retaliate against the U.S., one was the block of rare-earth exports to the US, potentially crippling countless U.S. supply chains that rely on these rare commodities, and forcing painful and costly delays in U.S. production as alternative supply pathways had to be implemented.
As a result, for many months China watchers expected Beijing to respond to Trump’s tariff hikes by blocking the exports of one or more rare-earths, although fast forwarding one year later this still hasn’t happened. But that doesn’t mean it won’t happen, and overnight President Xi Jinping’s visit to a rare earths facility fueled speculation that the strategic materials will soon be weaponized in China’s tit-for-tat war the U.S.
As Bloomberg reported overnight, shares in JL MAG Rare-Earth surged by the daily limit on Monday after Xinhua said the Chinese president had stopped by the company in Jiangxi, a scripted move designed to telegraph what China could do next.
The reason for the dramatic market response is that the presidential visit flags policy priorities, and “rare earths have featured in the escalating trade spat between the U.S. and China.” Specifically, as Bloomberg notes, China raised tariffs to 25% from 10% on American imports, while the U.S. excluded rare earths from its own list of prospective tariffs on roughly $300 billion worth of Chinese goods to be targeted in the next wave of measures. And just in case the White House missed the message, Xi was accompanied on the trip to JL MAG by Liu He, the vice premier who has led the Chinese side in the trade negotiations.
This news story showed up on the Zero Hedge website at 11:10 a.m. EDT Monday — and I thank Brad Robertson for bringing it to our attention. Another link to it is here.
The Shanghai Gold Exchange has delayed plans for a platinum contract after failing to gain political clearance, threatening a push to open up a market for the precious metal dominated by the arm of a big state-owned company.
The SGE had been due to launch a two-way cash-settled contract — enabling users to sell and buy platinum — in the first quarter but it failed to win approval, according to two people familiar with the exchange.
The failure highlights the difficulties of reforming China’s domestic commodity markets, where state-owned companies hold sway.
A platinum contract in China would have given carmakers in the world’s largest auto market the ability to hedge the platinum they use in their catalytic converters or fuel cell vehicles. Investors would also have been able to speculate on prices of the metal.
“It is quite a setback for the market,” said one industry source in China.
China is the world’s largest consumer of platinum, using 73.8 tonnes last year, a third of global demand, according to Johnson Matthey, a maker of platinum-based catalysts.
This precious metals-related news item was posted on the Financial Times website — and the above paragraphs are all of it that is posted in the clear on the gata.org Internet site. Another link to it is here.
An Australian man has unearthed a 1.4kg (49oz) gold nugget with a metal detector while wandering Western Australia’s gold fields, say locals.
A shop in Kalgoorlie shared pictures of the rock online, estimated to be worth A$100,000 (£54,000; US$69,000).
The unidentified man was an experienced local hobbyist, shop owner Matt Cook, told the BBC.
Finds of this scale by prospectors are known to happen a few times a year, experts say.
About three-quarters of the gold mined in Australia is produced in and around the Kalgoorlie region.
This very interesting article put in an appearance on the bbc.com Internet site on Monday sometime — and I thank Kiwi reader Kae Lewis for sharing it with us. Another link to it is here.
The PHOTOS and the FUNNIES
Continuing on with our excursion around Hope, B.C. on April 13…spring was well underway here on the west side of the mountains, but still a month away in Merritt, an hour’s drive east — and over the Northern Cascades. Click to enlarge.
With no volume worthy of the name in the precious metals on Monday, nothing much should be read into their respective price actions…down or up…although it should be noted that ‘da boyz’ set a new low for platinum for this move down. Both silver and copper are still below their respective 200-day moving averages.
Here are the 6-month charts for the Big 6 commodities — and there isn’t much to see except for what I just noted above. Click to enlarge.
And as I type this paragraph, the London open is less than ten minutes away — and I see that that the gold price has been edging quietly and unevenly lower almost since trading began in New York at 6:00 p.m. EDT on Monday evening — and it’s down $3.10 currently. Silver was down 4 cents by around 10:30 a.m. China Standard Time on their Tuesday morning — and has been creeping quietly sideways since — and is still down 4 cents at the moment. Platinum and palladium are both off their earlier highs in Far East trading. Platinum is back at unchanged, but palladium is still up 3 bucks as Zurich opens.
Net HFT gold volume is pretty light…coming up on 27,500 contracts — and there’s around 4,500 contracts worth of roll-over/switch volume on top of that. Net HFT silver volume is pretty light as well…just over 6,800 contracts — and there’s only 376 contracts worth of roll-over/switch volume in this precious metal.
The dollar index opened down 1 basis points or so once trading commenced at 7:44 p.m. EDT on Monday evening, which was 7:44 a.m. CST on their Tuesday morning. It has been crawling quietly higher since — and as of 7:45 a.m. BST in London/8:45 a.m. CEST in Zurich, it’s up 17 basis points.
Today, at the close of COMEX trading, is the cut-off for this Friday’s Commitment of Traders Report — and I’ll certainly have an opinion on what it might show in Wednesday’s missive.
And as I post today’s column on the website at 4:02 a.m. EDT, I see that gold is off its current low by a bit — and down only $1.90 — and silver is still down 4 cents. Platinum is now down a dollar — and palladium is up by 3.
Gross gold volume is 46,000 contracts — and minus roll-over/switch volume out of June and into future months, net HFT gold volume is a bit over 35,000 contracts. Net HFT silver volume is just under 8,600 contracts — and there’s 546 contracts worth of roll-over/switch volume on top of that.
The dollar index paused in it currently rally about twenty minutes before the London/Zurich opens — and hasn’t done much during the last hour of trading — and is up 11 basis points as of 8:45 a.m. in London/9:45 a.m. in Zurich.
That’s all I have for today — and I’ll see you here tomorrow.