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-- Posted Wednesday, 20 December 2006 | Digg This Article

The Metals:

Gold rose slightly in Asia and traded a few dollars higher near $624 in London before it fell in morning new York trade to as lows as $618.60 at one point, but it then rebounded a bit into the close and ended with a loss of just 0.11%.  Silver traded above $12.70 in London before it fell to as low as $12.43 in New York, but it also rebounded a bit into the close and ended with a loss of 0.56%.

Euro gold remained above €470, platinum remained unchanged at $1,117, palladium lost $2 to $321, and copper fell over 5 cents to about $2.95.

Gold and silver equities steadily fell off throughout trade and ended with over 2% losses.

The Economy:

There were no major economic reports today.  Tomorrow at 8:30AM EST brings 3^rd quarter GDP expected at 2.2% and the Chain Deflator expected at 1.8%.  Initial Jobless Claims are expected at 315,000.  At 10AM are Leading Economic Indicators for November expected at 0.1% and at noon is the Philadelphia Fed report for December expected at 4.0.

The Markets:

Charts Courtesy of http://finance.yahoo.com/

Oil rose after crude inventories fell a much more than expected 6.3 million barrels, but gains were limited as gasoline inventories rose a more than expected 1 million barrels and distillates rose a more than expected 1.2 million barrels.

The U.S. dollar index fell in early trade as the euro rose on inflationary remarks from Trichet, but it rebounded and ended slightly higher in thin trade on hopes for strong economic data tomorrow.

Treasuries remained near unchanged as traders looked ahead to economic data over the next two days.

The Dow, Nasdaq, and S&P traded mostly slightly higher but ended marginally lower on mixed earnings reports.

Among the big names making news in the market today were Arcelor, Mittal, Sicartsa, Pepsi Bottling, Family Dollar, NYSE Group and Euronext, FedEx, CarMax, Goldman, Ericsson, Redback, Cisco, and Delta.

The Commentary:

“This week has seen gold start on the back foot, but physical demand and investment demand moved into the breach and has taken gold back up.   With the $ struggling to hold its own, oil on the rise despite a mild winter and with support from an ever more powerful O.P.E.C. gold is looking robust in defense augering well for the near term.   Silver in its shadows took heavier body blows, but will be a more exciting shadow to gold soon.   Yes there is a constant danger of further falls, but we at silver and gold Forecaster have been saying for some time now, these are good opportunities.

Last week saw a much larger than usual amount of gold sold into the market by two of the signatories of the Central Bank Gold Agreement.   Instead of the usual 5 or so tonnes sold weekly, we saw 27 tonnes sold in that week.  

What is dramatic is that this means that less than 500 tonnes of gold remains to be sold by the C.B.G.A. signatories for the rest of the agreement, which has 2 year 9 months still to run.   

Their annual 'ceiling' of sales is set at 500 tonnes a year.   With less than 100 tonnes sold in this the third of the five year agreement, if they try to reach that 'ceiling' of 500 tonnes they will have 100 tonnes of gold of the announced sales only to sell in the remaining two years of the agreement.

Is this a last ditch attempt to pressure the gold price down?   If so it is not succeeding.  

If they continue to sell at this pace they will run out of gold to sell in this the third of the five years of the agreement.” - Julian D.W. Phillips, www.goldforecaster.com

“February Gold finished down 1.1 at 624.3, 2.9 off the high and 2 up from the low.

March Silver closed down 0.065 at 12.645. This was 0.125 up from the low and 0.195 off the high.

After starting out positive in the wake of a positive overnight trade, the US gold market was unable to hold the gains through mid session. In the early afternoon trade the Dollar managed to climb back into positive ground on the day and that seemed to give the bear camp in gold an added incentive. With margins reduced in gold that could prompt a slight increase in speculative interest on the long side, given the prevailing attitude of the specs but in the end the real driving force for gold will continue to be the direction of the US Dollar. However, periodic strength in the energy complex (the February contract actually rose to within striking distance of the last two weeks highs today) might be lending some indirect and muted support for the bull case. While the Dow did manage a fresh new high for the move during the session, the stock market wasn't really definitive in its direction and therefore the gold market probably wasn't markedly influenced by that outside market action.

With the March silver contract showing definitive interest in the $12.70 level and the market only fleetingly taking out the prior sessions highs, it is clear that the trade has become somewhat indecisive. However, with margins being reduced and oil prices remaining firm, the bear camp doesn't seem to have as much fundamental news flow going in its direction. On the other hand, an aggressive washout in copper prices, to the lowest level since June 27th would seem to hint at a slightly bearish overall metals environment.” - The Hightower Report, Futures Analysis and Forecasting

GATA Posts:

These people will be TOASTING the IMF

Why, Ted Butler asks, would anyone want a 'no delivery' contract?

Where would gold be without last week's €410 million in ECB sales?

Brunei Times takes note of GATA and FAME

Let them tax cake: IMF tells Zambia to apply VAT to food

No country manipulates its currency, Bush tells Congress

The Statistics:

As of close of business: 12/19/2006

Global Gold ETF Holdings

[WGC Sponsored ETF’s]

Note: Change in Total Tonnes from yesterday’s data:  The JSE added 0.12 tonnes.

COMEX Gold Trust (IAU)

Note: No change in Total Tonnes from yesterday’s data.

Silver Trust (SLV)

Note: No change in Total Tonnes from yesterday’s data.

The Stocks:

Gold Fields’ (GFI) extended offer for Western Areas, Metallica’s (MRB) closed financing, Almaden’s (AAU) closed financing, Kimber’s (KBX) board elections and chairman appointment, Exeter’s (XRA) vetoed legislation, Great Basin’s (GBN) investment, Strategic Nevada’s (SNS.V) board election, and MAG Silver’s (MAG.V) drill results were among the big stories in the gold and silver mining industry making headlines today.

WINNERS

LOSERS

Winners & Losers tracks NYSE and AMEX listed gold and silver mining stocks that trade over $1.

All of today's gold and silver stock news:

Roxmark announces CFO appointment and flow-through financing - More
- December 20, 2006 | Item | E-mail

MetalCORP; BIG LAKE Drilling Yields 3.1% Copper, 1.6% Zinc, 63.1 g/t Silver & 1.7 g/t Gold over 4.5 metres - More
- December 20, 2006 | Item | E-mail

Cooper Minerals Inc announces Access Agreement Signed for Great Bear Lake - More
- December 20, 2006 | Item | E-mail

Shoreham Completes Private Placement Financing - More
- December 20, 2006 | Item | E-mail

Metallica Resources Closes C$34.5 Million Equity Financing - "Metallica Resources Inc. (TSX:MR.TO - News)(AMEX:MRB - News) is pleased to report that it has closed its previously announced bought deal private placement financing. The Company has issued 7,670,500 units, which includes a 15% over-allotment option granted to the underwriters for 1,000,500 units, at a price of C$4.50 per unit for gross proceeds of C$34,517,250. Each unit consists of one common share and one-half of one common share purchase warrant. Each whole warrant entitles the holder to purchase one additional share for a period of three years at an exercise price of C$5.50." More
- December 20, 2006 | Item | E-mail

Golden Peaks Resources Ltd. - La Fortuna Project Update/Review - More
- December 20, 2006 | Item | E-mail

Anglo Canadian Uranium Corp.: Princeton Geophysics Survey - More
- December 20, 2006 | Item | E-mail

Firestone Ventures Expands Land Package in Southern Alberta - More
- December 20, 2006 | Item | E-mail

Strategic Nevada Resources, Welcomes Thomas F. Fudge Former VP of Operations for Hecla Mining and Former President of Hecla's Venezuelan Subsidiaries - "Mr. Neil Linder, the President of Strategic Nevada Resources (TSX VENTURE:SNS.V - News), is pleased to announce that Thomas F. Fudge Jr. is a licensed professional mining engineer with almost 30 years of experience in mining engineering, operations and project development." More
- December 20, 2006 | Item | E-mail

Diagem Announces Election of Directors and Officers, Grants Options and Retains Services of Sun International Communications - More
- December 20, 2006 | Item | E-mail

New Guinea Gold Corporation: Imwauna Hole IMH 085 Intersects 1.3m at 15.2g/t Gold - More
- December 20, 2006 | Item | E-mail

The Final Drill Results of 2006 and the Starting of the 2007 Drill Program - More
- December 20, 2006 | Item | E-mail