Gold Has Biggest Week In 18 Months; Bonds Ignore Stock Surge

Despite CAT explaining to the world that things are nothing like as good as they have said in the past and that their ability to forecast is gone given monetary policy hindrance (paraphrasing), the stock oscillated from pre-open gains to a big drop out of the gate, to a squeeze higher gapping as shorts covered to end the day up 2.75%. We explain this because it perfectly summarizes the market today. Overnight JPY weakness supported risk assets, Italy’s Napolitano helped, and into the open we were comfortably green; but the moment the bell wrung the sellers appeared and pushed the S&P down (coincidentally) to last Monday’s crash lows. Once Europe closed, the bulls got the green light and stocks surged on light volume running stops above overnight highs; stocks leaked back off their highs though ended comfortably green – a mere 20 S&P points off the intraday lows! While all this tom-foolery was occurring, Treasury yields plunged from their overnight highs and flatlined 1-2bps lower (ignoring equity’s after noon exuberance). Commodities were similarly unimpressed as gold and silver held overnight strength but flatlined in the US afternoon as stocks popped. FX was in charge of the rally today as AUDJPY ruled pre-European close and EURUSD ruled the afternoon. VIX compression as protection was unwound helped support risk, but high-yield credit slammed lower into the close.

Bonds ignored stocks today…

What was driving the ship today… S&P followed JPY-carry into the European close, and EUR all afternoon…

VIX compressed notably as protection was clearly unwound – with the S&P 500 cash index ending at last Wednesday’s gap down open…

The unwind of index protection has the smell once again of managers reducing size as market breadth was very weak (especially in the post EU Close) – as we noted last week, VIX was bid last week as the fastest most liquid overlay that can be slammed on a long book of stocks. Uncertainty remains high – as does realized vol recently – but today saw the selling pressure out of the gate matched by market breadth (real reduction) and then the afternoon saw the indices soar even as relative volume buying was very weak – this suggests that the VIX compression above was unwinding the macro hedge and unwinding underlying positions into that strength – as opposed a full risk-on lift…

Gold had its best day in 3 weeks ending back above $1425 and its best 5-day run in 18 months…

But it was FX that dominated cross asset class correlation today and drove stocks but the afternoon saw stocks off in their own world once again…

So it seems once again – today was a game of two halves with US equities bid after the European close and offered before… makes perfect sense if you forget that Europe re-opens in 8 hours…

Charts: Bloomberg and Capital Context

Bonus Chart: CAT… seemed to enjoy the European close too…

Source: http://www.zerohedge.com/news/2013-04-22/gold-has-biggest-week-18-months-bonds-ignore-stocks-surge

Gold Plummets By Most In 30 Years, Stocks Have Biggest Drop Of 2013

A bad day all around. Liquidation continued from Asia and commodities were Baumgartner’d – especially gold and silver, suffering their biggest single-day drop in 30 years. Weak NAHB data stalled any BTFD in stocks and despite a couple of tries at EUR ramps, stocks had their biggest drop in 5 months. The horrible acts in Boston seemed a catalyst for late-day weakness in stocks but there was no bid and heavy volume as homebuilders were hit their hardest in 10 months and US equity indices plunged into the close. Dow Transports had its worst day in 17 months. Away from stocks, FX markets were just as volatile with JPY’s 2-day rally the biggest in 35 months (and AUD the biggest down day in 5 months). Swiss 2Y rates dropped to their lowest of the year and US Treasuries were relatively calm (though bid) until Boston hit and then dropped 3-4bps on the day. VIX also surged higher by 5.2 vols to 17.25% (its highest since the Italian elections).

S&P futures ended at the lows…

and VIX surged…

which took everything but the magic Dow below Cyprus levels…

As FX Carry was dumped in a hurry… AUDJPY especially…

 

And commodities were slammed…

But some other markets had seriously bad days…

and Gold broke all kinds of records…

after-hours gold dropped more and S&P futures also followed…

Charts: Bloomberg

Bonus Chart: Despite the day’s chaos – risk-assets led stocks lower all day and the algos would not beat the real selling pressure for once…

Source: http://www.zerohedge.com/news/2013-04-15/gold-plummets-most-30-years-stocks-have-biggest-drop-2013

Turkey’s Silver Imports Surge 31% And Gold Imports Climb To 8 Month High

Turkey’s Silver Imports Surge 31% and Gold Imports Climb to 8 Month High

Today’s AM fix was USD 1,568.50, EUR 1,222.81 and GBP 1,038.40 per ounce.
Tuesday’s AM fix was USD 1,597.75, EUR 1,244.64 and GBP 1,051.64 per ounce.

Gold fell $23 or 1.45% yesterday while silver fell 76 cents or 2.7%.


Cross Currencies Table – Bloomberg

Gold has fallen to $1,570/oz as irrational exuberance continues in international markets with investors piling into equities as the U.S. stock market ‘crack up boom’ continues … for now.

Risk appetite remains recklessly high with the Dow Jones Industrial average up another 90 points yesterday to 14,662 and now targeting 15,000. This risk appetite is continuing to pressurise gold.

Gold’s lower quarterly close may also be leading to momentum players continuing to sell further pressurising gold. Gold’s fundamentals remain sound though and smart money will continue to buy on the dip.

Geopolitical risks in North Korea, between Japan and China and in the Middle East remain remain heightened and could intensify which could be the catalyst for gold bouncing from oversold levels.


Platinum in USD (5 Years) – Bloomberg

There are also still very significant sovereign risks with Slovenia and Luxembourg in the EU now under the spotlight and the risk of a major default in Argentina now looming.

Physical gold and silver demand remains robust in many markets internationally. Demand from the Middle East remains robust as seen in the near record imports of gold and silver into Turkey.


Palladium in USD (15 Years) – Bloomberg

Turkey’s gold imports climbed to an eight-month high in March as prices averaged the lowest since May, according to the Istanbul Gold Exchange. Silver imports rose 31% from a month earlier according to Bloomberg.

Gold imports increased to 18.26 metric tons, the most since July. That’s up from 17.34 tons in February and compared with 2.91 tons a year earlier, data on the exchange’s website show. The country shipped in 120.8 tons last year.

Turkey was the fourth-biggest gold consumer in 2012, according to the London-based World Gold Council. Bullion averaged $1,593.62 an ounce last month and is trading about 17% below the record nominal high of $1,921.15 set in September 2011.


Silver in USD (3 Years) – Bloomberg

Silver imports advanced to 6.19 tons in March, the most since January, according to the bourse. The nation imported 142.2 tons last year. Silver averaged $28.8157 in March, the lowest since July and remains well below the record nominal high of nearly $50/oz seen in April2011.

Gold and silver’s inflation adjusted record highs from 1980 of $2,400/oz and $140/oz have been our long term price targets since 2003 and remain so.

Platinum was down 1.4% to $1,568.50%, while palladium fell 1.6% to $766.75/oz but with large deficits expected for both PGM metals this year, weakness is likely to be fleeting.

Source: http://www.goldcore.com/goldcore_blog/turkeys-silver-imports-surge-31pc-and-gold-imports-climb-8-month-high