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-- Posted Friday, 29 February 2008 | Digg This Article | Source: GoldSeek.com

The Metals:

Gold rose to a new all-time high of $975.90 by late trade in Asia before it dropped in London to as low as $964.60 by about 10:45AM EST in New York, but it then rallied back higher into the close and ended with a gain of 0.72% at a new record closing high.

Silver set a new 27 year intraday high of $19.93 in Asia before it fell to $19.37 by about 8AM EST in New York, but it also rallied back higher for most of the rest of trade and ended with a gain of 0.61% at a new 27 year closing high.

Euro gold rose to €640, platinum gained $25.50 to a new record high at $2158, and copper fell a couple of cents to about $2.85.

Gold and silver equities fell roughly 3% from yesterday’s record highs despite nearly 1% gains in gold and silver as the major indices plummeted over 2% and dragged everything lower.

The Economy:

All of this week’s economic reports:

Next week’s economic highlights include Construction Spending and the ISM Index on Monday, ADP Employment, Productivity, Factory Orders, ISM Services, and the fed’s Beige book on Wednesday, Initial Jobless Claims and Pending Home Sales on Thursday, and February’s jobs data and Consumer Credit on Friday.

The Markets:

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

Oil fell about 1% in low volume as economic worries overcame supply concerns.

The U.S. dollar index fell to a new record low for the fourth straight session after yet another round of more poor economic data raised recession worries.

Treasuries found substantial gains as the Dow, Nasdaq, and S&P fell markedly on more weak economic data and poor earnings reports.  Stocks ended lower for the fourth straight month.

Among the big names making news in the market Friday were Ambac, Wilber Ross, AIG, Brown-Forman, Dell, and Swiss Re.

The Commentary:

“Price action in the precious metals was quite volatile today as the normal end of month positioning by longs booking profits came into conflict with superb fundamentals that continue to attract buying on any retreat in prices. Both gold and silver were well bid today even as sellers continued clipping their advances. Front month Silver notched a move above the $20 level before the funds decided to take a bit of money off the table so as to be able to brag a bit to their customers but even at that, its foray into the negative column did not last very long.” - Dan Norcini, Much more free commentary at JSMineset.com

“April Gold finished up 7.5 at 975, 2 off the high and 8.5 up from the low.

May Silver closed up 0.205 at 19.915. This was 0.345 up from the low and 0.025 off the high.

The gold market showed somewhat of choppy two sided trade throughout the trading session Friday but generally favored the upside. In fact, the market managed another new all time high and forged the high in the face of a minor rally in the US Dollar and perhaps even more importantly in the face of weakness in energy prices. In fact, the European gold market actually managed a new record high close and with the US equity market coming under more significant liquidation pressure one might suggest that gold was being supported by classic flight to quality conditions. While wheat prices were sharply lower and corn prices were mixed, soybean oil and other edible oil prices were sharply higher and that in turn has rekindled food price inflation fears, which in turn might have lent some support to gold prices.

The silver market seemed to fight the early strength in gold but eventually the market seemed to settle into an upbeat posture. Like the gold market the March silver contract did manage to forge another new high for the move and in turn managed the rally despite countervailing outside market price action. Surprisingly the silver market wasn't undermined by the weakness in copper prices and the apparent escalation of US recession fears and that is surprising considering the magnitude of the selling pressure seen at times in the US equity markets. It is possible that soaring edible oil prices lent some inflation support to silver and other commodity prices.”- The Hightower Report, Futures Analysis and Forecasting

GATA Posts:

Paul takes Bernanke to school about inflation

Anything to divert gold demand from physical to paper

IMF gold sales may be off-market transactions

The Statistics:

As of close of business: 2/29/2008

Global Gold ETF Holdings

[WGC Sponsored ETF’s]

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

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:

Freeport’s (FCX) annual report, Apollo Gold’s (AGT) updated mineral reserve estimate, Orezone’s (OZN) permit approval, Newmont’s (NEM) deadline request, Paramount’s (PZG) assay results, AngloGold’s (AU) power contract, Coeur’s (CDE) fourth-quarter and year-end results, MAG Silver’s (MVG) drill results, and Apex Silver’s (SIL) year-end results were among the big stories in the gold and silver mining industry making headlines Friday.

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