As stocks hit new highs, gold and silver suffer
Precious metals tumble as inflation fears ease and the US economy shows strength.
But the real action was in gold (-GC) and silver (-SI). Gold in New York fell by $25 to $1,575.90 an ounce. That was down 1.6% on the day, and it continues the pressures that have pushed gold lower for most of the year.
Silver fell by 69.6 cents to $27.25 an ounce in New York. That was the lowest close for the metal since late summer 2012.Gold is down nearly 6% this year and down about 12.3% from a closing peak of $1,796.50 an ounce on Oct. 4, 2012. While silver is off nearly 10% in 2013, it's also down about 22% from an Oct. 1, 2012, peak at $35.608 an ounce. A loss of 20% or more is the popular definition of a bear market.
The reasons for the selling are multiple, all having to do with the dollar:
- There are worries about Europe and the ultra-high unemployment rates in Spain, Italy, Greece and Cyprus.
- Japan has been working to push the yen lower to make its exports more competitive globally.
- The U.S. economy is looking stronger this year, despite a relatively weak jobs market and the potential that federal spending cuts instituted under a 2011 budget deal will stall domestic growth.
- There have been few inflationary pressures. That had many investors worried when the Federal Reserve embarked on its latest bond-buying program. It's usually called QE3, for a third round of quantitative easing.
If there is an immediate reason to be at least wary. Friday is when the Labor Department reports the March unemployment and non-farm payroll numbers. Both are expected to be decent.
Bright Media Corp. estimated late Tuesday that the economy added 223,000 jobs in March. The consensus estimate is about 195,000 with the unemployment rate holding at 7.7%.
The Dow and S&P 500 moved higher in large part because of a big rally in health-insurance stocks. They surged because it appeared premiums paid under the Medicare Advantage plan could move higher. Most investors had expected premium cuts.
The Dow closed up 89 points to 14,662. The blue chips had been up as many as 111 points. The S&P 500, which set a new closing high on Friday, closed up 8 points to 1,570 after reaching as high as 1,573.66.
This last level is important. It was 2.4 points below the S&P 500's all-time intraday high of 1,576.06, reached on Oct. 11, 2007. A solid push through that level could mean the rally has the strength to move higher.
The Nasdaq Composite Index ($COMPX) climbed 16 points to 3,255, its best close since Nov. 7, 2000.
So, health insurer UnitedHealth (UNH) was the top performer among the 30 Dow stocks, up $3.40 to $62.37 after hitting a 52-week high of $63.95. UnitedHealth contributed 26 points to the Dow's by itself. 26 Dow stocks were higher.
DaVila HealthCare Partners (DVA), which provides kidney-dialysis services, jumped $7.29 to $127.20 and was the the top performer among S&P 500 stocks. It, too, hit a 52-week high: $128.74. Eight of the top 10 S&P 500 performers on Tuesday were healthcare stocks.
At the same time, investors were cheered by a gain in factory orders in February. The gain was spurred by growth in commercial aircraft and automobiles.
March auto sales were up 3.4% from March 2012, and the seasonally adjusted annual sales rate moved up to 15.27 million units from 14.14 million units in March 2012. There was a downside to the sales: the sales rate was the lowest of 2013, but the rate has topped 15 million for five straight months.
Ford Motor (F) shares were up 11 cents to $13.01. General Motors (GM) shares rose 13 cents to $27.93.
If there was a theme to the month it was that light trucks, including sport-utility vehicles, were the big sellers. Most manufacturers saw car sales decline; Honda (HMC) was an exception.
More on Top Stocks
Since the latest gun control controversy ammunition is getting scares and the shelves at most gun dealers even walmrt are empty.
Looks like Lead may be a precious metal and a good buy right now...
Well anyway I was adding more to our Gold positions this morning...
But then commenced to take a haircut, this p.m....
Not only had gold been falling early, but our miner had a problem in Brazil about off loading product for shipment....
Today was not the best day for us to buy....Oh well...que,sera,sera...
We aren't on suicide watch, we just fixed a stiffer drink..Too busy to worry about little things..
To comment on the recent DOW, S&P, jobs, housing and dollar rebound. Stein's law.........“If something can’t go on forever, it will stop.”-Herbert Stein, economist
Take advantage of the recent market upswing, be weary & mindfull that it will not go on forever. It is artificially propped. Interest rates will have to rise at some point in time. Inflation will not be easily concealed and covered up by the government's false CPI data. What comes up, must come down. Learn from the lessons of 2007-2009 and what caused them. Remember that 16 trillion and counting, fiat money printing expanding the money supply, social programs, spending without budgets or means, infinite borrowing with no savings or production is mathematically unsustainable, there will be a day of reckoning at some point in the future. This is all common sense, regardless of investment or financial experience. Do not make the same mistake twice, don't get suckered in with the same dance, different song. That's all I'm saying.
I'm not sure why anyone would be invested in stocks, metals or real estate right now. All three have been artificially inflated by Bernanke dollars and have no threshold assets to retard loss. As they go, they go all the way. In all three venues there are very large players wholly leveraged without safety. Collapse is eminent and both derivatives and debt contracts can force the large players into default. You won't get the chance to sell when the chain reaction drives all three to the bottom.
Are you looking out the window?
Yes, if they could take the fraud out of Welfare and the likes of Foodstamps ,etc...
We could probably build new Highways and Bridges (repairs)..
And start paying down our debt...
Those people should get some real hard time....Working on the roads in a Chain Gang..
The Fraudsters..that is.
I'm no fan of Glen Beck but he's right about precious metals. Don't just read the headlines put out by mainstream media do some research and find out what's going on behind the scene.
The cheerleaders of Wall street don't tell us the real news. The stock market is being artificially inflated thru the Federal Reserve Bank QE. We could be heading towards another financial disaster similar to the one we experience in 2008. Except this time it could be worse.
The recent events in Cypriot should serve as a wake up call to all of us that things are not as they appear. And as far as precious metals goes they are manipulated by JPM to make the dollar look strong. A law suit was brought against JPM which was dropped. Why? Because of JPM political clout.
Banks throughout the west are financially insolvent. When Europe's financial system implodes then that will affect us in the U.S. Other countries such as the BRICS ( Brazil, Russia, India, China, South Africa) see the handwriting on the wall and is actively seeking a way around the USD ( world's reserve currency) they just opened the World Development Bank as a way to circumvent the IMF, BIS and the world bank.
Don't beleive the hype spewed by the main strem media.
ABS...I keep leaving you clues before I go, to give you a treasure hunt of sorts as to where I abode.
I probably will never admit to the correct location...Within less than 500-600 miles...
I could be near your backyard, actually I'm right here with you; On your PC or Laptop..
Miss Lilly says I'm addicted and only laughs at the thought of me fading away after 10,000..
That makes me stronger every day....I've almost given up Twinkies, and I was addicted to them for almost 65 years...This is a walk in the Park..
Only about 40 more to go...Good luck in your endeavors..
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Stocks drift lower and bonds are hit as investors await the Fed. Prepare for higher volatility this week.
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