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Weekly Survey of Gold and Silver Prices
Single Ounce Silver Market Price Benchmark
Money Daily has been providing business and financial market news, views, and coverage on a nearly continuous basis since 2006. Complete archives are available at moneydaily.blogspot.com.
PRIOR COVERAGE:
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Friday, February 9, 2024, 9:07 am ET This Sunday, it is estimated that more than half the adult population of the United States will spend roughly four hours watching a football game. Granted, it is the championship game of the NFL, the Super Bowl, so, a large audience is to be expected. Thursday night, Tucker Carlson released the video of his interview with Russian President Vladimir Putin. It is unprecedented. Carlson has been threatened over it. The interview runs just over two hours, about half the length of the Super Bowl. Will half the adult population take the time to watch it? Probably not, which exemplifies America's preferences perfectly. Most people would rather watch a meaningless sports contest than the only interview since the start of hostilities in Ukraine with the leader of the country on the other side. It's safe to say that many more people will see and hear the interview with the winning quarterback of Sunday's football game than the only interview by an American journalist with President Putin. Taken for what it is, does it represent an engaged, informed citizenry? No, it does not. It represents an American public that's been neutralized against anything that actually matters by a government and a media complex that enjoys the luxury of a captured viewership. The same goes for the election process. American media has a monopoly on propaganda there as well. Americans will see and hear what the media elite wishes them to, nothing more. Americans deserve what they will get, both on the international stage and in domestic affairs, because they are either too lazy, too disunited, and/or too disinterested in anything more taxing than a sporting event. Thus, as the S&P reaches for 5000, there's no mind paid to what's behind the explosive growth of US equity markets over the past few years and especially since October of 2023. On the 27th of October, the S&P closed at a near-term bottom of 4117.37. On Thursday, the closing bell had it at 4,997.91. Thats a gain of 21.39% in just more than three months. Some might call that extraordinary. Others may consider it preposterous. Practically speaking, nobody questions why stocks have had such a solid run, but closer inspection reveals that most of the gains in the S&P index came from a handful of stocks, otherwise known as the Magnificent 7, the tech stocks everybody needs to own, or, so it appears. They are GOOG, AAPL, AMZN, META, NVDA, MSFT, and TSLA, but, lately, the two big leaders are META and NVDA. Such intense concentration usually leads to poor results overall. When investors in these sparkling exemplars of American ingenuity and corporate management decide to take profits - and they eventually will - markets are going to experience severe pain. On Thursday, the S&P traded in a range from 4,987.09 to 5,000.40. 13 points. Is it a sign that the 5000 level is perceived as a near term top? Very possibly. Considering the aforementioned concentration in the Magnificent 7 stocks, it's not likely to hold unless these already overpriced equities are pushed even higher. Caveat Emptor. Elsewhere, gold is taking a spanking the moring, silver to a lesser extent, more a wrist-slap. Bitcoin has vaulted by more than $2,000 early this morning, making a two-year high at 47,480.70. The US wants to send another $60 billion to Ukraine, $16 billion to Israel. The term malinvestment comes to mind. This morning, the Bureau of Labor Statistics (BLS), released the annual adjustments to seasonal factors in the CPI This is how they put it:
Updated seasonal factors to be introduced February 9, 2024 Apparently, wading through it all, whatever adjustments were made seem to be on the positive side, i.e., lower or tamer inflation, because stock futures headed to the moon on the release. Good luck.
At the Close, Thursday, February 8, 2024:
Thursday, February 8, 2024, 9:24 am ET The S&P 500 came within a whisker of the magical 5000 mark on Wednesday, hitting a high of 4,999.89, according to Yahoo Finance. There is absolutely no reason to believe that the index will not exceed that mark within a very short time, possibly today. Other than that obvious headline-grabber, earnings reports were made by PayPal (PYPL), Disney (DIS), Wynn Resorts (WYNN), Mattel (MAT) after the bell Wednesday. Disney received investor approval for beating estimates on the bottom line. Shares of Disney are up seven to eight percent in the pre-market. The stock has been cut in half since its high of 197.16 in March, 2021, closing Wednesday at 99.14. PayPal delivered a solid quarter, with EPS of $1.48, but issued weak guidance, sending shares lower by more than eight percent. Shares were already at levels not seen since 2017 when the stock closed for trading on Wednesday at 63.24. Indications are for the payment-processing company to open in the mid-50s. Wynn Resorts posting a positive quarter, soundly beating estimates for EPS of $1.15, returning $1.91 for the fourth quarter. Shares are moving higher. Trading near multi-year lows, Mattel topped earnings estimates and is marginally higher in pre-market trading. Thursday, before the open ConocoPhillips (COP) is positive, trading near all-time highs; Hershey (HSY) missed on revenue, but reported EPS (non-GAAP) of $2.02 vs analyst estimates of $1.96. Shares are sliding by two to three percent. UnderArmor (UAA) is approaching penny stock valuation, trading under $10 per share after reporting. The stock is priced at levels not seen since 2011. After the close: Affirm (AFRM), Pinterest (PINS), and Expedia (EXPE) report. Weekly jobless claims came in lower than expected. Americans filing for jobless benefits for the first time last week dropped from 227k to 218k despite reports of mass layoffs at a growing number of companies. Gold and silver are flat-lining, WTI crude is nearing $75/barrel. Should the S&P race past 5,000, it's not expected to move much higher. The entire market is grossly overvalued and led by only a handful of companies. Market breadth is horrible, considering the extent of gains in the rally since November. A pullback of 5-15% should not be ruled out under current conditions. Futures are mixed, with the Dow up, S&P and NASDAQ lower.
At the Close, Wednesday, February 7, 2024:
Wednesday, February 7, 2024, 9:03 am ET With the bulk of the big names having already reported full year and fourth quarter earnings, Wall Street will be looking for other signals by which to send stocks higher or lower. Tuesday night and Wednesday morning reports from Snap, Inc. (SNAP), Ford (F), Chipolte (CMG), Amgen (AMGN), Alibaba (BABA), CVS Health (CVS), and Hilton (HLT) were good enough to inspire confidence, especially Chipolte, which beat estimates handily sending shares higher by more than three percent in the pre-market. Stock futures were weak overnight, but were jolted higher right around 8:00 am ET when troubled New York Community Bank (NYCB) announced the appointment of Alessandro DiNello as executive Chairman, effective immediately. NYCB, which has been under fire recently due to liquidity issues and regulatory concerns. Mr. DiNello has served as the non-executive chairman of the board after joining the NYCB following the completion of the Flagstar bank acquisition in December 2022. Previously, he was President and CEO of Flagstar Bank since 2013. Flagstar has extensive commercial real estate (CRE) and residential exposure along with parent NYCB. At the end of the fourt quarter 2023, NYCB had $116.3 billion of assets, $85.8 billion of loans, and deposits of $81.4 billion. Since filing its fourth quarter earnings report, NYCB shares have fallen off a cliff, to the tune of a 60% loss. On January 30, the stock closed at $10.38. On Tuesday, February 6, the closing price was $4.20. After the close, Moody's downgraded the company's bonds to junk. Moody's downgraded NYCB's ratings from Baa3 to Ba2. Moody's also warned that there would likely be more downgrades in the CRE space, affecting most regional banking outfits. On Friday, February 2nd, Fitch downgraded NYCB and Flagstar from BBB to BBB- and issued an "outlook negative" rating. NYCB is yet another canary in the financial coal mine. The appointment of Mr. DiNello may have improved confidence short-term, but the company looks very much like the next bailout target. Other banks that may be in short sellers' crosshairs include Zion's Bancorp (ZION), Truist (TFC), Comerica (CMA), Regions Financial (RF), Key Corp. (KEY), Huntington (HBAN), and others. While the Fed has helped some of these banks with temporary assistance via short term loans, the Fed's Bank Term Funding Program (BTFP) is set to shut down in March, leaving banks in precarious positions, holding in reserve underwater notes purchased when interest rates were in the one to two percent range. As workers refused to return to offices following the pandemic, commercial real estate in cities large and small began to lose value. Empty high-rise buildings with leaseholders defaulting en masse is precipitating the next banking crisis. For now, the Fed seems less than concerned, but insiders are aware of the crumbling core of commercial real estate. Elsewhere, after the close, PayPal, Walt Disney and Uber report. Gold is down marginally, while silver has taken a beating, pricing in the low $22 range.
At the Close, Tuesday, February 6, 2024:
Tuesday, February 6, 2024, 9:54 am ET With the yield on 10-year treasury notes spiking to 4.18% early Monday morning and the 30-year arcing to 3.35%, the selloff in bonds sparked a downward shift in equities at the cash open. Worst hit was the Dow, wherein investors took exception to McDonald's (MCD) untimely earnings miss, followed by the NASDAQ, as tech stocks continued to be teased and tested. The bearish sentiment lasted but a short while. Stocks began pumping higher late morning and continued on that path until the S&P turned green and the NASDAQ reached the unchanged level late afternoon. Yields failed to accelerate further, keeping stocks subdued, but by no means in a state of panic. The Dow finished with an ugly scar while the other indices suffered minor wounds. New York Community Bank (NYCB), which was dashed last week on mounting liquidity issues, continued to be unfavorable, reaching a multi-decade low of $5.40, a level not seen in that stock since 2000. McDonald's ended the day with an ugly loss of more than three percent with future prospects appearing somewhat clouded, especially in foreign markets where the Golden Arches are seen as a symbol of American adventurism. Sales across the Middle East, Asia, South Pacific, and some regions of France slumped over the quarter, victim of ongoing Meddle East hostility. Tuesday opened with a slightly more positive tone after British Petroleum (BP) reported positively and boosted share buybacks. Losses narrowed on Spotify (SPOT), reporting increased subscription uptake in the fourth quarter. Eli Lilly (LLY) posted gains of nearly three percent early Tuesday after the company reported quarterly earnings and revenue ahead of expectations. Auto-maker Toyota boosted 2024 guidance after a solid fiscal third quarter beat. Shares were higher by seven percent in early trading. After the bell, reports from Snap, Inc. (SNAP), Ford (F), Chipolte (CMG), and Amgen (AMGN) will be released. Just another day at the salt mine.
At the Close, Monday, February 5, 2024:
Sunday, February 4, 2024, 11:24 am ET The Fed held firm on rates and Friday's jobs report was a bit of a shocker for the "rate cut" crowd. META's dividend announcement shored up a lackluster tech space. Stocks Five weeks into 2024, stocks re-emerged as the place to be, with modest gains across the various indices on the rigors of Treasury's quarterly refunding, the first FOMC meeting of the year, a smashing Non-Farm Payroll report (+353,000) for January, and a spate of earnings reports which included the biggest tech names. Highlighting the week was Meta Platforms (META) announcing a quarterly dividend of 50 cents, putting the parent company of Facebook and Instagram on an investor pedestal, joining the likes of Apple and Microsoft. Google parent, Alphabet (GOOG) didn't enamor themselves to buyers, nor did Apple (AAPL), both of which were down sharply on the week. Apple is down for the year so far, while Goggle is clinging to a tenuous gain of two percent. Tech stocks, having led the market most of 2023, may be experiencing a bit of portfolio rebalancing, as managers shift to more beaten-down sectors, such as consumer discretionary, energy, and raw materials. The Dow and S&P were clear leaders on the week, with Dow Transports the fly in the ointment, losing ground for the third week in the first five of the year, also lower year-to-date. The Dow, NASDAQ, and S&P have now strung together four straight winning weeks after a sluggish week lower to begin the year. Leaving the hordes of analysts still seeking a rate cut in March in tears, the FOMC left rats unchanged, Treasury plans of borrowing much less than anticipated (it is an election year, after all), and the jobs report stunned easy money lovers into silence. Fed Chairman Jerome Powell channeled his best Paul Volker/Alan Greenspan impressions for the FOMC press conference, appearing alternatively hawkish and non-committal, frustrating anyone and everyone seeking negative guidance on the economy. Should the Fed decide to cut rates at all, it is most likely to be no earlier than May, and maybe not even until July or September. Thus, Wall Street's script has been flipped. It's now back to good news is good for stocks; bad news having been neutered. Looking ahead after an intense week of numbers, indications, and innuendo, another busy earnings week is on the horizon with a light diet of Dow component companies reporting. Monday, before the bell: Caterpillar (CAT), McDonald's (MCD), Estee Lauder (EL), Allegiant (ALGT); after the close, Palantir (PLTR), Chegg (CHGG). Tuesday, before the bell: Lilly (LLY), Spotify (SPOT), BP (BP), Toyota (TM); after close: Sanp, Inc. (SNAP), Ford (F), Chipolte (CMG), Amgen (AMGN). Wednesday, prior to open: Alibaba (BABA), Uber (UBER, CVS Health (CVS), Hilton (HLT); post-market: PayPal (PYPL), Disney (DIS), Wynn Resorts (WYNN), Mattel (MAT). Thursday, before open: ConocoPhillips (COP), Hershey (HSY), UnderArmor (UAA); after the close: Affirm (AFRM), Pinterest (PINS), Expedia (EXPE). Friday, before the bell: Pepsico (PEP), AMC Networks (AMCX), Enbridge (ENB)
Despite a rather unruly selloff Friday, long-dated maturities rallied on the week, with the 30-year leading the charge, down 16 basis points. Ten-year yields dipped well below 4.00%, but were pushed forward on Friday, leaving them down 12 basis points. Spreads inverted for the worse, with 2s-10s out to -33, and full spectrum at -127. After the FMOC meeting and the blowout jobs report Friday, expect rates to increase and spreads to go even more negative as more tightening appears to be necessary to strangle the seemingly booming economy. The Fed, somewhat at the mercy of the market, is likely more than happy to have traders do the dirty work of pushing long term rates higher. The Fed, faced with conditions they neither expected nor completely understand, is in a tight spot. There's no way they can cut rates at this juncture and any rate hikes would absolutely crush the stock market. Doing nothing - which is what most of the bean-counters do best - seems the likely course through Spring and into Summer. Liquidity is becoming an issue, as New York Community Bank (NYCB) came up short and scared everyone, losing more than 40% on the week. Having scooped up some underperforming assets from Signature Bank last year and facing heightened regulations, NYCB got hit with a double whammy and may be the next bailout target. Other regional banks are also in hot water. Last spring's financial tumult appears not to have been ended, but merely paused. Another round of bank failures of scale would not be surprising, especially given the carnage in commercial real estate, which has yet to be addressed. Spreads:
2s-10s
Full Spectrum (30-days - 30-years)
Oil producers can't catch a break. After reaching an 11-month high the last full week of January at $78.23, WTI futures got shaken back to earth, closing out the week in New York at the modest, sensible price of $72.41 per barrel, and that's despite inflamed tension in the Middle East. It pays to be reminded that the Saudis cut prices to their best customers (China, India) just a few weeks ago, and US production is running red hot. Even with the US economy humming along, there's no sign of a shortage anywhere, delighting the election handicappers on the left. If history and politics are reliable guides, WTI will struggle to break above $80 for the remainder of 2024, with a good possibility of falling into the high $60s. Milder weather, work-from-home (WFH), and fuel economy are all serving to keep a lid on prices. According to gasbuddy.com, the national average for a gallon of unleaded regular gas at the pump rose five cents, to $3.15. The Northeast and the West coast still have the highest prices. Cheap gas is found in Oklahoma ($2.63), where prices are the most stable. Arkansas, Missouri, and Kansas were close followers at $2.66 last week, but Kansas and Arkansas both jumped to $2.76, and Missouri to $2.83. Prices also jumped higher across the Southeast. Mississippi ($2.73), Louisiana ($2.80), and Texas ($2.84) were all up notably this week. Florida ($3.22) and Georgia ($3.01) are the only Southeastern states above $3.00, but all others are up above $2.83. These prices may not hold for long, especially after the beating crude oil took this week. However, ExxonMobile (XOM) and Chevron (CVX) shareholders were disappointed this week with earnings results. Energy producers would love higher prices, which is why consumers hate them. By all appearances, sub-$3.00 gas is good for the economy, which is good for re-election of presidents, senators, and House representatives, so expect lower prices if weather cooperates. Sub-$3 gas pushes through the Midwest all the way up to Iowa ($2.85) and Wisconsin ($2.77), North Dakota ($2.78), Minnesota ($2.92), Montana ($2.88), and Idaho ($2.84). California ($4.56) remains the only state on the mainland with prices above $4.00, as Washington, the next highest, dropped again this week, to $3.92. Nevada is next at $3.82, followed by Oregon ($3.59), and Arizona ($3.26). In the Northeast, Pennsylvania ($3.38) remained on top with the highest prices, followed by New York ($3.25). The lowest prices in the region are West Virginia ($3.01) and Ohio ($3.02). Every other state in the Northeast is in a range from $3.08 to $3.20.
This week: $42,850.00 Meh. Anybody buying bitcoin with hopes of massive gains is a fool because bitcoin's inflation, according to this chart, is going to fall to under one percent as of the next halving (April) and continue to decline from there, as the intention is for price stability, not inflation. Eventually, bitcoin will emerge as a stable currency, as intended. In the US, UK, and Europe, however, it has been so heavily regulated that price distortions are part of the package. It's a currency, and, being stable, is hated by fiat-pushers.
Gold:Silver Ratio: 90.26; last week: 88.96 Per COMEX continuous contracts:
Gold price 1/5: $2,052.60
Silver price 1/5: $23.39 Gold has maintained a price above $2,000 for 52 consecutive days (since December 14, 2023) on the COMEX continuous contract, reaching a high for the year this week at $2.077.70 before the NFP report Friday took all the wind out of its sails. Meanwhile, silver continues extremely undervalued and available for hoarding. Having closed below $23 each of the past three weeks, any more good economic news will almost certainly send it lower. Prices appear to be stabilizing, though another raid on the COMEX is almost a certainty within the next few weeks. Silver could test $21 again, and gold is likely to hang in a range between $2015 and $2050, as central bank buying is still too robust to drop the price much, if at all. Unless the Middle East becomes a blazing inferno, prospects for precious metals remain somewhat dim. However, with the gold:silver ratio upwards of 90 now, silver stackers may be preparing to scoop up coins and bars with both hands. Here are the most recent prices for common one ounce gold and silver items sold on eBay (numismatics excluded, free shipping included):
The Single Ounce Silver Market Price Benchmark (SOSMPB) was nudged slightly higher from the prior week, to $36.00, a gain of six cents from the January 28 price of $35.94 per troy ounce.
Stocks are the golden goose so far this year. Unless somebody gets nuked, expect them to keep reaching for new highs.
At the Close, Friday, February 2, 2024:
For the Week:
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