Gold and Silver Decline on Stronger Dollar, Weaker Greece
By Eric McWhinnie | May 9, 2012 12:58 AM IST
On Tuesday, gold (NYSEARCA:GLD) futures for June delivery declined $34.60 to settle at $1,604.50 per ounce, while silver (NYSEARCA:SLV) futures fell 66 cents to close at $29.50. It was the lowest close for gold since January 3.
Precious metals declined as the U.S. dollar gained strength for the seventh consecutive trading day, its longest winning streak since 2008. Political turmoil in Greece has investors on edge. Discussions to form a new coalition government eludes the country and new elections may have to be held. This increased more fears about Greece not being able to meet the terms of its bailout.
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“Overseas, there’s a problem there. I think it’s going to spill over into other markets. I thought the selling would be more rapid than it is,” said Stephen J. Caral from Williams Capital Group, according to WSJ. Gold and silver price both declined more than 2 percent, while the Dow Jones Industrial Average fell 1.1 percent.
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In afternoon trading, the SPDR Gold Trust (NYSEARCA:GLD) declined 1.87 percent, while the iShares Silver Trust (NYSEARCA:SLV) fell 2.05 percent. Gold miners (NYSEARCA:GDX) such as Barrick Gold (NYSE:ABX) and Newmont Mining (NYSE:NEM) both dropped more than 3 percent. Silver investments such as Silver Wheaton (NYSE:SLW) and Endeavour Silver (NYSE:EXK) declined 3.8 percent and 2.06 percent, respectively.
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Disclosure: Long EXK, AG, HL, PHYS