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-- Posted Wednesday, 2 July 2008 | Digg This Article | Source: GoldSeek.com

The Metals:

Gold and silver remained near unchanged in Asia before they dropped over 1% in London to as low as $931.45 and $17.868 by a little before 8AM EST, but they then rallied back higher in New York and ended near their highs of $945.52 and $18.33 with gains of 0.21% and 0.96%.

Euro gold fell near €593, platinum lost $2.50 to $2071, and copper gained over 15 cents to about $4.08.

Gold and silver equities fell throughout the day along with the major indices and ended with about 3% losses.

The Economy:

Tomorrow at 8:30AM EST brings Initial Jobless Claims for 6/28 expected at 385,000 and June’s job data.  Nonfarm Payrolls are expected at -60,000, the Unemployment Rate is expected at 5.4%, Hourly Earnings are expected at 0.3%, and the Average Workweek is expected at 33.7.  At 10AM is the ISM Services report for June expected at 51.0.

The Markets:

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

Oil rose to a new record high of $143.91 after crude inventories fell a larger than expected 2 million barrels.  Gasoline inventories grew 2.1 million barrels, distillates rose 1.3 million barrels, and refinery utilization rose 0.6% to 89.2%.  Oil has climbed above $144 in after hours trade at the time or writing.

The U.S. dollar index fell and treasuries rose as interest rates dropped on the worse than expected ADP Employment report that raised worries over tomorrow’s government jobs report that comes shortly after an expected interest rate hike from the ECB.

The Dow, Nasdaq, and S&P fell throughout the day and ended about 2% lower on record high oil and concern about the economy.

Among the big names making news in the market today were Blockbuster, UnitedHealth, GM, Avis, and Starbucks.

The Commentary:

“Dear CIGAs,

Today the Secretary of the Treasury discussed the following points:

Point 1: International regulations are draconian with central banks now becoming the regulators to stabilize markets. Under the proposed new regulations the new regulators have the right and obligation to take over all types of banks and international investment banks when required without usual procedures.

Translation: This is it. The OTC derivative meltdown is far from over or under control. The history of central bank’s judgment of markets is probably the worst anywhere. In retrospect, central banks have always caused the bubbles and breaks.

Point 2: The Secretary sees economic activity in the Euro zone weakening.

Translation: “Dear ECB: Please do not raise rates.” Good luck on that one.

Point 3: We are going through a rough patch in business.

Translation: It is going to get really bad out there. Put on a hard hat if you walk close to any building in which financial entities exist.”- Jim Sinclair, JSMineset.com

“August Gold finished up 2 at 946.5, 1 off the high and 10 up from the low.

September Silver closed up 0.135 at 18.425. This was 0.285 up from the low and 0.005 off the high.

August gold spent most of the day inside yesterday's range, but by the end of the day the market was threatening yesterday's highs. The crude oil market made new all time highs again today, as were grains, livestock, and a host of other commodities, feeding fears of commodity price inflation, which is supportive to gold. The dollar was down sharply, which also makes gold and other precious metals an attractive alternative investment.

July silver pushed above yesterday's highs and was threatening the May 26th high of 183.75 by the end of the session. In addition to finding support from outside market forces like the weak dollar and soaring commodity prices which make silver an attractive alternative investment, the growing number of mines going out on strike also lent support. Reports that workers at two more mines in Peru threatened to go out on strike lent support as well. While the latest struck mines primarily produce copper, zinc and gold, the strike action in general appears to be spreading across all types of mines, which implies silver could be affected as well. Peru is the world largest producer of silver.”- The Hightower Report, Futures Analysis and Forecasting

GATA Posts:

David Brooks: Total control of U.S. in sight for Goldman Sachs

The Statistics:

As of close of business: 7/1/2008

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:

Peru’s mining strike, Ivanhoe’s (IVN) mine in Mongolia, Apollo’s (AGT) amended financing, Central Sun’s (SMC) drill results, Fortuna’s (FVI.V) ongoing operations in Peru, South American Silver’s (SAC.TO) drill results, ECU’s (ECU.TO) drill results, Alexco’s (AXU) drill results, and Arian’s (AGQ.V) assay 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:

Expanded Successful Regional Exploration Is Well Underway in the Silvery Slocan - More
- July 02, 2008 | Item | E-mail

Jasper Mining Corporation commences 2008 exploration program on Isintok property - More
- July 02, 2008 | Item | E-mail

Mongolia riots blur outlook for big Ivanhoe mine - "Rioting in Mongolia's capital over alleged election fraud could further blur the timetable for getting government approval for Ivanhoe Mines' (IVN.TO: Quote, Profile, Research) big Oyu Tolgoi copper-gold deposit, analysts said on Wednesday." More
- July 02, 2008 | Item | E-mail

South American Silver Announces Extension of Silver Enrichment at Malku Khota - "South American Silver Corp. ("SASC" or the "Company) (Toronto:SAC.TO - News) is pleased to announce the results from the next 12 holes from the Malku Khota Project, Bolivia. All diamond drill holes are from the Central Limosna Zone." More
- July 02, 2008 | Item | E-mail

Apella Increases Vanadium Interests - More
- July 02, 2008 | Item | E-mail

Canada junior miners seen more prone to takeover - "Tight credit conditions are keeping exploration-stage Canadian mining companies from raising capital, a development that could lead to more takeovers from larger players, according to a study released on Wednesday." More
- July 02, 2008 | Item | E-mail

Breakwater Issues News Release Pursuant to Early Warning Requirements - More
- July 02, 2008 | Item | E-mail

Fortuna's Peruvian Operations Not Affected by National Strike - "Fortuna Silver Mines Inc. (CDNX:FVI.V - News)(BVL: FVI) wishes to confirm that operations at our Caylloma Mine in southern Peru are unaffected by the miners' union strike which started on Monday this week. All of our mine and office personnel are conducting their activities normally as the mine is non-unionized." More
- July 02, 2008 | Item | E-mail

High Desert Gold's Reconnaissance Program Locates Strong Gold Mineralization on Its Kinkaid Property, Mineral County, Nevada - More
- July 02, 2008 | Item | E-mail