Gold & Silver Market 10-24-2015
There was a definite decline in the precious metals sector last week, with most prices slightly down. That included the headline commodities, gold and silver, although performance in the platinum group was more mixed. The obvious reason for the fall in metals is a good week on the equities markets that saw the FTSE 100 hit a new two-month high, and the Dow Jones rise strongly after a hesitant start. Although the link between shares and commodities has been weak recently we would definitely expect to see metals fall after such a good period for the stock exchanges; what’s encouraging is that not all of them did and the losses were modest. We don’t see this as a reason to start moving out of metals.
Most analysts have focused on gold, which ended last week at $1,164. That’s $13.70 down on its previous close, a big enough drop to be noticed but not an alarming one in the circumstances. Considering how buoyant equities turned out to be gold has actually held up better than expected, and if the momentum in share prices fades – which it’s likely to – we expect gold to start rising again.
Silver lost 23 cents through the period to close at $15.81, a slightly higher percentage drop than gold but not enough to open out the silver-gold ratio by much. Again we think silver has performed pretty well considering the gains on the Dow and FTSE, and in fact from its movements the price looked to be more robust than gold for most of the week.
Platinum was the only one of its group that fell last week, dropping $14 to $999. Its high for the week was $1,019, as the spot price rose in response to the Dow’s initial shakiness, and again we think it’s looking fairly robust. The prospect of interest rate cuts in both the Eurozone and China is likely to boost the outlook for commodities and platinum should be well placed to benefit from that.
Moving on to palladium, at a weekly scale there wasn’t much activity at all. The price fell over weekend trading, recovered Monday, then dropped again midweek. However it then started to climb again and ended the period heading confidently upwards. The final price was $692, $2 on the week before, too small a drop to be significant. What’s more interesting is that the price managed to climb alongside the biggest rises in equities, suggesting that palladium is basically in good shape for now.
Last there’s rhodium, which managed to gain value the previous week but now seems to have settled back into lethargy. There was no significant movement all week, and the spot price is still sitting exactly where it was at $785.
So a mixed week, but in the circumstances probably better than expected. It also seems likely that share prices won’t keep rising at their present rate, and that should open the way for more rises in the metal market. Rhodium is questionable but the others all look like good investments right now.
About the Author: Clint Stelfox
Clint is the director of marketing at Golden Eagle Coins. Son of Richard Stelfox, co-founder of the company, Clint has been living and breathing coins his entire life. After trading for a Philadelphia Stock Exchange firm for several years Clint returned to give Golden Eagle the online presence it has today. 
