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Page added on April 15, 2013
Commodities Crunched: Gold Gored, Crude Oil Runs Red
The action on Wall Street Monday was in the commodity markets, where a selloff got underway early and picked up speed. Crude oil was down more than 2% and below $90 a barrel, while gold slumped almost 6% to near $1,400 an ounce.
The drop came as a reading out of China showed economic growth in the world’s marginal buyer of commodities slowed unexpectedly to 7.7% in the first quarter, after rebounding in the back half of 2012.
Oil prices fell on both sides of the Atlantic, with U.S. benchmark West Texas Intermediate down $1.96, or 2.2%, to $89.33 while the international benchmark Brent dropped $1.82, or 1.8% to $101.23 a barrel.
Energy stocks got caught up in oil’s stumble — Chevron fell 1.4% and Exxon Mobil 0.8% — but it was nothing like the downdraft in the entire gold-related complex.
With the yellow metal off $87.20, or 5.8%, to $1,414.20 an ounce, stocks and exchange-traded funds linked to either the metal or the companies that mine it were in freefall.
The SPDR Gold Trust (GLD) dropped 5.5%. Miners Goldcorp, Barrick Gold and Newmont Mining were down 5.9%, 9.6% and 7.4% respectively, while an ETF that counts all three among its five largest holdings, the Market Vectors Gold Miners (GDX), dropped 7.9%.
4 Comments on "Commodities Crunched: Gold Gored, Crude Oil Runs Red"
Arthur on Mon, 15th Apr 2013 6:44 pm
I already had the feeling that we were past peak gold and acted upon it. Private persons have less savings than 5-10 years ago when the boom began. Although the nominal value of gold might increase again in case of hyperinflation, in real terms I think this was it.
J-Gav on Mon, 15th Apr 2013 10:13 pm
This gold manipulation is quite transparent, really. As TPTB press countries like Cyprus and Portugal etc to use their gold reserves to pay off their austerity borrowings, obviously the paper gold market will be pushed down through naked short selling of certificates they don’t even have – so they can pick up that gold at lower prices later on … Once this duck shoot is over, the price will inexorably rise again as the bullion market (as in real possession, not paper) has not flagged at all over this period. China knows it, Russia knows it, Washington knows it, the average investor is the sucker, as usual. Silver’s good too, by the way.
Cloud9 on Tue, 16th Apr 2013 12:10 am
My hand full of coins are just as shiny as they ever were. My grandchildren will enjoy them so for me this is a side show. Someone over on Zero Hedge mentioned that the last time gold got monkey stomped like it has been the last few days Lehman blew up. I wonder what is blowing up we don’t know about.
BillT on Tue, 16th Apr 2013 12:43 am
Ho hum … wake me when something important happens. Gold is just being pushed down again to keep the price low so the CBs can buy more. The Market Casino has a 50+% correction coming. Now THAT might be worth taking notice of, if I had a dog in the game. We live in interesting times…