Apmex Gold & Silver Market Report -- 8/9/2011

The following is a commentary from APMEX

APMEX Morning Gold & Silver Market Report -- 8/9/2011
(Ryan Schwimmer), APMEX - Commentaries

FOMC MEETING TO BRING NEWS OF QE3?

U.S. stock futures are pointing to big gains this morning, a day after the 6th-worst drop in the Dow in history. All eyes are once again on the Fed Open Markets Committee meeting today, as investors await news of another round of quantitative easing. The FOMC meeting was originally not expected to weigh on the markets, but after last week's lackluster economic reports and the downgrade of the country's credit rating by Standard & Poor's, the story has changed. The poor performance on the stock market is not exclusive to the U.S., however. Global recession fears are growing as Asian and European stocks are also taking a beating.

Gold is sitting on a fresh record high amid big gains overnight. As the financial uncertainty around the world increases, investors are attracted to the safe-haven appeal of gold. Peter Hillyard of ANZ said, "The market could come off from here, but it's headed in a northerly direction. From where we are now, you might think we could see some sort of pull-back. But I'm talking about a momentary thing, a pull-back like the loading of a gun, which then fires away." UBS strategist Edel Tully said that "the ingredients are all in place for a stronger gold price, as the metal is not subject to the risk of intervention or quantitative easing."

At 8:06 am (CT) the APMEX precious metals spot prices were:

Gold - $1,749.60 -- Up $34.40.
Silver - $38.13 -- Down $1.36.
Platinum - $1,739.00 -- Up $15.40.
Palladium - $737.50 -- Up $7.00.

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Mid-Day Gold & Silver Market Report -- 8/9/2011
(Timothy Oakes), APMEX - Commentaries

FED MAY HAVE A LOT TO SAY TODAY

The stock market is rebounding on the hope the Federal Reserve will come out with measures to help buoy the current economic condition facing the United States. The meeting is set for later this afternoon (2:15 pm ET) and speculation is mounting that Chairman Ben Bernanke may announce steps to ramp up growth. According to Wayne Lin, a money manager at Legg Mason Inc. of Baltimore, "The market has convinced itself that Bernanke is going to, or has to, say something to calm the markets...It's a matter of confidence. After yesterday's drop in stocks, investors are hoping that the administration has gotten the message that they need to get their act together. The other part of it is that a lot of the measures we're looking at are saying that relative to bonds, stocks are very cheap."

For the first time since fresh financial crisis worries surfaced, Chinese Premier Wen Jiabo came out urging global nations to come together to stabilize current market conditions. In a radio address to China, he said, "We urged relevant countries to take responsible monetary and fiscal policies to cut fiscal deficits and properly manage the debt crisis, to ensure a stable performance of global markets and maintain investor confidence...The global community should improve the communication and coordination of their macroeconomic policies to realize sustainable, stable and balanced growth in the world economy."

At 12:00 pm (CT) the APMEX precious metals spot prices were:

Gold - $1,745.40 -- Up $30.20.
Silver - $38.07 -- Down $1.42.
Platinum - $1,755.80 -- Up $32.20.
Palladium - $736.60 -- Up $6.20.

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Closing Gold & Silver Market Report -- 8/9/2011
(Robert Davis), APMEX - Commentaries

STOCKS RECOVER FROM YESTERDAY'S SELLOFF BUT BERNANAKE SAYS ECONOMY IS AT RISK

Stocks rose sharply today, recovering much of yesterday's losses. Gold held steady, still viewed by many as a safe haven asset in times of volatility. The big news of the day was the release of the report from the Federal Open Markets Committee, a decision-making panel of the Federal Reserve. Upon the release, Fed Chairman Ben Bernanke made a statement, in which he said, "Economic growth so far this year has been considerably slower than the committee had expected," and that the "downside risks to the economic outlook have increased." While stopping short of announcing further rounds of quantitative easing, Bernanke did say that the Fed was keeping key interest rates at very low levels until at least 2013, an indication that the Fed does not think that the slowdown will end anytime soon.

Is it too late to invest in gold? With U.S. debt downgraded, Treasury Bills are no longer seen as the completely risk-free assets they used to be. Meanwhile, gold has been on an astounding run for the past few days as investors flock to it as a store of wealth and a safe haven. William Rhind, Managing Director of ETF Securities says, "The fundamentals to invest in gold have not changed... The only thing that has changed is that investment case is stronger - the world's best credit, the U.S. government - has been downgraded. It's no longer as safe as it was."

At 4:15pm (CT) the APMEX precious metals spot prices were:

Gold - $1,748.60 -- Up $33.40.
Silver - $37.83 -- Down $1.66.
Platinum - $1,761.00 -- Up $37.40.
Palladium - $742.60 -- Up $12.10.