Published October 08, 2013
| Wall St. Cheat Sheet
On Tuesday, gold (NYSEARCA:GLD) futures for December — the most active contract — edged 50 cents lower to close at $1,324.60 per ounce, while silver (NYSEARCA:SLV) futures gained 6 cents to finish at $22.44. Major exchanged-traded funds, like the SPDR Gold Trust and the iShares Silver Trust, also closed relatively unchanged.
The markets continue to remain focused on the U.S. Government, and its inability to reach a deal over the budget and debt ceiling. Republicans proposed a new committee to address the fiscal issues facing America, while President Obama repeated that he will not negotiate until the government shutdown and debt ceiling are dealt with first.
“We can’t make extortion routine as a part of our democracy, democracy doesn’t function this way,” Obama told reporters at the White House. “We’re not going to calm creditors until they see speaker Boehner call up a bill that reopens the government and authorizes the secretary of the Treasury to pay our bills on time, and until they see that, there’s going to be a cloud over U.S. economic credibility.”
By the end of the trading, shares of the SPDR Gold Trust (NYSEARCA:GLD) and iShares Silver Trust (NYSEARCA:SLV) both declined 0.20 percent. Gold miners (NYSEARCA:GDX), Barrick Gold (NYSE:ABX), and Yamana Gold (NYSE:AUY) dropped more than 3 percent each. Shares of Endeavour Silver (NYSE:EXK) sank nearly 6 percent.
Adding to the selling pressure, Goldman Sachs said gold is a “slam dunk” to sell once politicians end the fiscal fight. The bank has a target of $1,050 per ounce on gold next year. “You have to argue that with significant recovery in the United States, tapering QE should put downward pressure on gold prices.” The SPDR Gold Trust and iShares Silver Trust are down more than 20 percent year-to-date.
Don’t Miss: Are Nations Still Hunkering Down with Cash?
Follow Eric on Twitter @Mr_Eric_WSCS
If you would like to receive professional analysis on miners and other precious metal investments, we invite you to try our premium service free for 14 days.
Disclosure: Long EXK, AG, HL, PHYSRead the original article from Wall St. Cheat Sheet