Industry Report
March 24, 2016
The Weekly Dig
Haywood Mining Team
Gold Price Fails to Find Support after Brief Surge following Brussels Attacks
§ The terror attacks in Brussels dominated this week’s headlines, after simultaneous bombings were reported at Brussels airport and at the City’s Metro Station, resulting in at least 32 people dead and over 200 injured. The tragedy amplified tensions in the region, as Europe still reeled from similar attacks in Paris in November last year. As expected, global markets fell, while safe-haven assets including government bonds and gold rose, with the latter hitting $1,259 per ounce during intra-day trading on Tuesday; markets settled quickly, however, with the Dow Jones Industrial Average down only 41.30 points, while the S&P 500 was largely unchanged at close. Following these brief market gyrations, metal prices across the board declined significantly; precious metals, and gold in particular, fell on the back of a strengthening U.S. dollar, finishing the week at $1,219 per ounce (↓3.7%) on Thursday heading into the Easter holiday period. The strengthening U.S. dollar has been attributed to the view that the Federal Reserve’s Open Market statement last week may have been too “dovish”. In response, silver (↓4.7%), platinum (↓4%) and palladium (↓3.3%) fell, finishing at $15.19, $947 and $574 per ounce respectively, while base metals fared no better, with copper (↓2.4%), nickel (↓2.85%), lead (↓3.5%) and zinc (↓2.5%) each finishing at $2.26, $3.91, $0.79 and $0.81 per pound respectively. One of the worst performers for the week was oil, with U.S. supply data indicating higher-than-expected stockpiles and stubbornly high production; WTI crude prices tumbled 5.4% to finish at $39.53 per barrel. Finally, UxC Broker Average (BAP) Price of uranium underwent a relatively flat week, finishing slightly lower (↓1%) at $29.44 per pound.
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