Written by Sumit Roy  |

August 30, 2012

Morning Call: Gold & Silver Rise One Day Ahead Of Bernanke Speech, NatGas Awaits Inventory Report

Details

Commodities mostly rise, outperforming stocks.

Commodities are mostly higher, while stocks are lower today, just one day ahead of Ben Bernanke's highly anticipated speech in Jackson Hole, Wyo. In economic news, personal income in July rose by 0.3 percent, matching expectations, while personal spending jumped 0.4 percent, slightly below the anticipated 0.5 percent.

Meanwhile, the number of people filing for unemployment benefits in the U.S. was unchanged at 374K last week.

In Europe, Spanish 10-year bond yields—currently seen as the best gauge of eurozone sovereign debt fears—rose by 12 basis points to 6.58 percent.

The U.S. Dollar Index fell by 0.12 percent to 81.45.

• Precious metals are slightly higher on anticipation of potentially dovish comments from Fed Chairman Ben Bernanke on Friday. Gold was last trading up by $5.43, or 0.33 percent, to $1661.93, while silver edged up by $0.12, or 0.39 percent, to $30.87.
  
  Platinum rose by $4.63, or 0.31 percent, to $1521.88 and palladium added $2.55, or 0.4 percent, to $634.80.
  
  "On gold we are very much into a wait-and-see approach," Saxo Bank analyst Ole Hansen told Reuters. "[There was] a bit of profit taking yesterday, but considering the move higher last week it is holding up very well, with investors reluctant to let go."
  
  "As long [as] we can hold $1,630 support on any pull-back, the technical outlook looks pretty good," he added.
  "We think the most likely outcome tomorrow will be an extension of the very low interest rates until 2015."
  Gold holds steady ahead of Jackson Hole
  
  
• Crude oil is higher today, as Brent rises by $0.76, or 0.68 percent, to $113.30, while WTI puts in a fractional advance to $95.50.
  
  "Isaac doesn't seem as if it [inflicted] any serious damage to oil production in the Gulf, and everybody is waiting for Jackson Hole, which I think will be a non-event," said Michael Poulsen, an analyst at Global Risk Management.
  Oil Declines for a Second Day as Stockpiles Rise, Storm Weakens
  
  
• Natural gas is little changed after the expiration of the September futures contract. The new front-month contract—gas for October delivery—was last trading close to flat at $2.68/mmbtu.
  
  The EIA may report that last week operators injected 61 billion cubic feet into inventories when it releases its Weekly Storage report later today, according to a survey of analysts by Reuters.
  Warm forecast props up US Sept natgas futures at expiry
  
  
• The grain complex is narrowly mixed. Corn was last trading up by $0.03, or 0.4 percent, to $8.14/bushel, while soybeans edged down by $0.02, or 0.11 percent, to $17.61 and wheat advanced $0.02, or 0.23 percent, to $8.88.
  
  "There has been some underlying support for wheat in the last few days amid a tender from Saudi Arabia, while the recent acquisition of wheat from Tunisia has buoyed the expectation of continued demand from North African countries," Graydon Chong, senior analyst at Rabobank, said.
  Wheat dips on profit-taking but Russia worries supportive
  
  
• Copper was last trading up by $0.04, or 1.1 percent, to $3.48/lb on Comex.
  
  "Copper prices started turning around after the meeting between [Chinese Premier] Wen and [German Chancellor] Merkel. Investors feel reassured," said a Shanghai-based trader.
  Copper snaps losing streak as China supports eurozone
  
  

What to Watch For:

8:30 a.m. ET: Personal Income/Spending (July)

8:30 a.m. ET: Initial Jobless Claims

Time Unknown: ICSC Chain Store Sales (August)