Published May 16, 2012
| Wall St. Cheat Sheet
On Wednesday, gold (NYSEARCA:GLD) futures for June delivery declined $20.50 to settle at $1,536.60 per ounce, its lowest level since July. Meanwhile, silver (NYSEARCA:SLV) futures fell 88 cents to close at $27.20.
Both precious metals finished lower as the U.S. dollar marched higher for the 13th consecutive day. Euro zone central bank sources said the European Central Bank has stopped monetary policy operations with some Greek banks due to recapitalization concerns. The announcement comes a day after President Karolos Papoulia’s website said Greeks have withdrawn as much as 700 million euros ($893 million) from the nation’s banks since May 6.
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Reuters reports, “The ECB only conducts its refinancing operations with solvent banks. With no access to ECB funds, the banks concerned must go to the Bank of Greece for emergency liquidity assistance. It was unclear exactly how many banks were affected. One person familiar with the matter said four Greek banks’ capital was so depleted they were operating with negative equity capital. According to its own rules, the ECB cannot provide liquidity to banks in such a situation.”
In afternoon trading, the SPDR Gold Trust (NYSEARCA:GLD) edged .09 percent lower, while the iShares Silver Trust (NYSEARCA:SLV) declined 1.75 percent. Gold miners (NYSEARCA:GDX) such as Barrick Gold (NYSE:ABX) and Yamana Gold (NYSE:AUY) jumped 1.5 percent and 2.8 percent, respectively. Silver names such as Silver Wheaton (NYSE:SLW) and Endeavour Silver (NYSE:EXK) popped 2.75 percent and 1.07 percent, respectively.
Despite once calling gold the “ultimate bubble,” George Soros’ hedge fund nearly quadrupled its exposure to the SPDR Gold Trust from 85,450 shares in the fourth-quarter to 319,550 shares in the first-quarter. Soros Fund Management also opened a new position through call options in Newmont Mining (NYSE:NEM), one of the world’s largest gold producers.
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Disclosure: Long EXK, AG, HL, PHYS