Market Recap 5/6/11


The month of May began excitedly with the global headline of the week. Late Sunday evening, President Obama announced to the world that Osama bin Laden was found and killed. American stock futures and the U.S. Dollar immediately began to rise as the price of Gold fell $16.00. Silver which already had a tumultuous. weekend, took a sharp dive . By mid-day, it was apparent that the bin Laden bounce was short lived.

The ADP Private Sector jobs report was released Wednesday. Private sector jobs increased by 179,000 jobs in April which was lower than analysts’ expectation of 200,000 jobs. The good news is that layoffs level in 2011 reached a marked low. Stock futures had dropped in anticipation of this report and declined further after this announcement. Precious. metal prices continued their retreat in overnight trading but Gold and Silver began recovering with the release of this news.

Later that day, reports came out that Mexico’s central bank had been quietly stocking up on Gold. They boosted their foreign reserves by trading $4 Billion worth of U.S. Dollars for $4 Billion in Gold. “They’re probably thinking that getting out of Dollars and into Gold makes sense because we know that the Dollar has some trend to depreciate in the near future at least,” said Sergio Martin, Chief Economist at HSBC in Mexico City. “I don’t think they’re going to lose money with this.”

Thursday was streamed with bad news and extreme market volatility. The number of U.S. unemployment claims was expected to drop 19,000 this week but instead rose by 43,000 to 474,000. This is the highest level in eight months. The four-week moving average for jobless claims, considered the better trend measurement, rose 22,250 and is now over 400,000 to 431,250.

Also on Thursday, a new report by Clear Capital stated that home prices have double dipped nationwide. Nationwide prices are now lower than their low point of 2009. Prices have fallen 11.5% in the past nine months. Over one third of the national home sales are coming from bank owned properties (REO) and banks want to get these properties off their books, thus driving prices down.

By the end of the day, oil fell below $100 per barrel on the concerns that a slumping economic climate will lower demand. The stock market was down triple digits and precious metals went through a major correction. It all started with the precious metals earlier,” said James Cordier, a portfolio manager at Optionsellers.com in Florida. “Oil is down because everyone is heading for the doors,” he added. A weak jobs report added fuel to the fire with investors again worrying about a double-dip recession, Cordier said. “Here we are supposedly at the height of the recovery and not only we can’t create jobs, we are losing jobs.”

Friday began with what looked like good news but turned out to be conflicting reports. Non-Farm payrolls were unexpectedly up, but unemployment unexpected climbed to 9%. Stock, oil and precious metal prices all bounced up on this report.

Gold:
Spot Gold prices opened this week at $1,567.30. The high during the week was on Monday, May 2nd, at $1,577.40, while the low for the week occurred on Friday, May 6th, at $1,471.10. Gold ended the week down $66.60 at $1,500.70. This week, the most popular Gold bullion products were 2011 Gold American Eagles, 1 oz. Pamp Suisse Gold Bars, and 2011 1 oz. Gold Maple Leafs.

Silver:
Spot Silver prices opened this week at $48.04. Silver reached a high of $48.19 on Monday, May 2nd, while this week’s low for Silver occurred on Friday, May 6th, at $33.04. Silver ended the week down $12.19 at $35.85. The most popular Silver products on APMEX.com this week were 2011 Silver American Eagles, 2011 Silver Maple Leafs, 1 oz. Silver Buffalo Rounds and 10 oz. APMEX Silver Bars.

Platinum:
Spot Platinum prices opened this week at $1,879.00 and ended the week down $87.40 at $1,791.60. Popular Platinum products this week included 1/10 oz. Platinum American Eagles, and 1 oz. Platinum American Eagles.

Palladium:
Spot Palladium prices opened this week at $796.60 and ended the week down $79.40 at $717.20. Palladium investors preferred 1 oz. Pamp Suisse Palladium Bars and Palladium Canadian Maple Leafs this week at APMEX.com.

Featured Bullion Product:
The Canadian Silver Maple Leaf, the official Silver bullion coin of Canada, has become one of the most popular Silver coins sought after by investors and collectors worldwide. Since first being minted by the Royal Canadian Mint in 1988, the design of the Silver Maple Leaf has undergone annual changes that include proof releases, various privy marks, holographic enhancements, and commemorative variations. However, the basic features of the Silver coin have remained the same since its inception. The obverse of the coin depicts an effigy of Queen Elizabeth II, and the reverse of the coin showcases the signature Maple Leaf so closely associated with Canadian nationalism and reflective of Canadian pride.

What sets this Silver gem apart from its Gold and Platinum counterparts is the fact that the consumer demand for the Silver Maple Leaf has caused the prices for the coin to skyrocket past the actual bullion value of the coin. For example, while the face value of the Silver Maple Leaf is five Canadian Dollars, the highest face value among international Silver bullion coins, the coin has generated prices that far outweigh its actual face value. In addition to its high value, the Silver Maple Leaf is unique in that it is one of the purest Silver bullion coins on the market. With a 99.99 percent purity, the Silver coin ranks among the purest Silver bullion coins ever produced.

For its numerous positive qualities, the Canadian Silver Maple Leaf is a treasure that could potentially enhance any coin collection or investment portfolio. Because of the high value, purity level, and clear symbolism of Canadian culture, the Silver Maple Leaf is a coin that has developed a high international profile and will most likely continue to play a major role in the world coin markets.

Share