The early parts of this week have been quiet, but that has thus proved beneficial for gold and silver spot values. Risk-aversion is beginning to grip the marketplace which, in turn, has given some momentum to the gold and silver bulls. Unfortunately, today has saw the US Dollar break a bit of a downward skid and this has limited the buying interest associated with precious metals. All in all, this week is not set to bring about too much in the way of economic data, but from the looks of it, this much could serve to continue benefiting the precious metals market.
US Equities Rebound on Better Earnings
Over the course of the last week or more, US equity markets have played host to a good bit of volatility; finishing drastically upward one day while tumbling downward the next. For many, this volatility meant that perhaps US equities were finally through with their months-long rallies. Today silenced some of the US equity market doubters and saw all three major equity markets on the up and up throughout much of the morning.
Market experts are attributing today's progress with better-than-expected earnings reports from both Citigroup and Johnson and Johnson. J&J's third-quarter performance greatly bested expectations and, as a result, the stock has jumped by more than 1% today. Not only were third-quarter earnings better than expected, but so too are projections for annual growth. Citigroup's stock was up by more than 2% on better earnings and reports that the company had increased its lending.
While the fact that equities and the Dollar are both trading up may not be the best for precious metals, it is encouraging to see gains continue to be made in the face of these competing asset-classes. So long as the belief remains that interest rates in the US will be held steady for the time-being, I think it is very possible that gold and silver will continue to receive some upside support. With that said, however, anything can happen over the course of the coming days and weeks.