Precious metals daily update

Precious metals daily update


Precious Metals Sales and Trading — London 44-20-7815 4210 RDD:STPM; New York 1-212-407-5102 RDD:STNN; Hong Kong 852-2822-7888
RDD:STDH; Singapore 65-6533-7086 RDD:STDS; Dubai 971-4-330 0011 RDD: SBDB; Tokyo 81-3-4520-6002 SDD:STDJ; Reuters prices SBLLMETALS
Commodities took strain again yesterday. WTI crude
dropped below $50, and base metals kept sliding. PGM
slipped further, but gold held steady.
Bearish sentiment into year-end is draining liquidity from
the markets. Equity markets had another torrid day, with
US shares falling more than 5%, while the FTSE closed
down 3.3%. However, some consolidation might take
place today. After trading in the red overnight, the Nikkei
is back in positive territory this morning, but only just. Equity
futures are up more than 2%, pricing in a sizable rebound
in US shares later today.
While any positive sentiment in markets should support
commodities, a rebound in US equities could support
platinum and palladium in particular. An equities rebound
could be spurred by prospects of a bail-out plan for US
car-makers. Therefore, we see upside for PGM today,
especially after yesterday’s slide in platinum and palladium
(but any recovery would still be limited). There is a
caveat to this: look out for the Eurozone PMI manufacturing
index today. We expect the index to signal a manufacturing
sector still in contraction. A large decline in the
reading could put PGM prices under pressure.
On the FX front, volatility is back, with the euro bouncing
between $1.2600 and $1.2400 against the dollar. Should
the Eurozone data today come in more negative than
expected, the euro will come under strain.
On a positive note, Libor rates are on the decline again.
After briefly rising since Monday, the 1-month US Libor is
now only 35 bps above the Fed funds rate. Slowly but
surely interbank lending is normalising.
Gold had a positive, but volatile, day. After finding initial
resistance at $740 in Tokyo, buying interest, supported by
a stronger euro, pushed gold to $745 when European
markets opened. With liquidity thin, and European equities
down, gold bounced between $740 and $750. Although
this continued in New York, gold finally managed
to break above $750 in New York as the Dow clawed
back some of its earlier losses. The metal closed at $748.
Primary support is at $725, with secondary support at
$714 and $700. Resistance is at $755, $774 and $800.
Gold steady, PGM slides
November 21st 2008
Walter de Wet, +27 11 378 7220
Walter.deWet@standardbank.com
Silver held steady between $9.30 and $9.40 in Asia and Europe, but was
sold off aggressively in New York. It held support at $8.83, and bounced
to a close of $9.07.
Platinum and palladium saw good volumes in Tokyo. Both metals were
sold off aggressively in early morning trade. This resulted in platinum
falling to $790. Palladium, on the back of US woes, dropped all the way
to $182. Platinum found some support at the $790, but never regained
the early morning losses. When New York markets opened, the selling
resumed, pushing platinum to a close of $785 (after bouncing off a low of
$778). After falling below $200, palladium remained under pressure. After
reaching a low of $175 in New York, it closed at $179.
Rhodium fixed at $1,195.
Metal AM Fix PM Fix High bid Low offer Close bid
Daily
change EFP's
Gold 745.25 738.00 753.00 735.50 748.00 12.00 -0.50/-0.10
Silver - 9.390 9.430 8.87 9.07 -0.26 -3.50/-1.5
Platinum 803.00 797.00 814.00 783.00 785.00 -35.00 2/5
Palladium 183.00 179.00 195.00 178.00 179.00 -13.00 -1/2
Prices (US$)
Metal 1 month 2 months 3 months 6 months 12 months
Gold 0.0800 0.0450 0.0500 0.4633 0.8917
Silver 0.0617 0.0900 0.2183 0.4167 0.4533
USD Libor 2.4638 2.6713 2.8038 3.0938 3.2406
Forwards (%)
Metal 30-day-RSI 10-day MA 20-day MA 100-day MA 200-day MA Support Resistance
Gold 45.36 737.62 739.92 834.44 876.00 738 755
Silver 38.81 9.57 9.66 13.10 15.44 8.78 9.42
Platinum 35.48 828.92 827.37 1,276.45 1,658.15 762 810
Palladium 38.25 210.73 205.34 276.80 368.64 174 186
Technical indicators
Comex GLD
Dec'08
Comex SLV
Dec'08
NYMEX
PAL Dec'08
NYMEX
PLAT Oct'08
DGCX
GLD
Oct'08
TOCOM
GLD Jun'09
CBOT GLD
Dec'08
Settlement
748.70 9.0490 181.05 790.10 750 2,263.00 748.70
Open
Interest
290,560 91,929 13,652 17,011 944 79,440 5,479
Change in
OI*
860 76 297 280 54 2,142 -7
Date: 20-Nov-08 * Open interest
Active Month Futures
2
Precious Metals Sales and Trading — London 44-20-7815 4210 RDD:STPM; New York 1-212-407-5102 RDD:STNN; Hong Kong 852-2822-7888 RDD:STDH;
Singapore 65-6533-7086 RDD:STDS; Dubai 971-4-330 0011 RDD: SBDB; Tokyo 81-3-4520-6002 SDD:STDJ; Reuters prices SBLLMETALS
Date/Time (GMT+2) Data/Event Consensus Previous
17-Nov
01:50 JPY GDP (Q3) 0.1% q/q -3.0% q/q
02:01 GBP House prices (Nov) —- -4.9% y/y
08:00 JPY BOJ’s Nishimura speaks —- —-
10:00 EUR ECB’s Tumpel-Gugerell speaks —- —-
12:00 EUR Trade balance (Sep) —- -€9.3bn
15:30 USD Empire Manufact (Nov) -27.0 -24.6
16:00 USD Fed’s Hoenig speaks —- —-
16:15 USD Industrial production (Oct) -0.2% m/m -2.8% m/m
18-Nov
ZAR Treasury briefing on financial crisis —- —-
10:10 EUR ECB’s Tumpel-Gugerell speaks —- —-
11:30 GBP CPI (Oct) 4.9% y/y 5.2% y/y
15:30 USD PPI (Oct) 6.2% y/y 8.7% y/y
16:00 USD Total net TIC flows (Sep) —- -$0.4bn
17:00 EUR ECB’s Stark speaks —- —-
20:30 EUR ECB’s Trichet speaks —- —-
19-Nov
11:30 GBP BOE minutes —- —-
15:30 USD CPI (Oct) 4.1% y/y 4.9% y/y
15:30 USD Housing starts (Oct) 780K 817K
16:00 USD Fed’s Kohn speaks —- —-
20:30 USD Fed’s Lacker speaks —- —-
21:00 USD FOMC minutes —- —-
20-Nov
11:30 GBP Retail sales (Oct) 1.5% y/y 1.8% y/y
15:30 USD Initial jobless claims (Nov) —- 516K
15:30 USD Continuing claims (Nov) —- 3,897K
17:00 USD Phili Fed (Nov) -35.0 -37.5
17:00 USD Leading indicators (Oct) -0.6% 0.3%
21-Nov
—- ZAR SARB’s Mboweni speaks —- —-
01:30 USD Treasury’s Paulson speaks —- —-
04:00 USD Fed’s Bullard speaks —- —-
04:00 JPY BOJ rate decision 0.30% 0.30%
11:00 EUR PMI manufacturing (Nov) 40.5 41.1
11:00 EUR PMI services (Nov) 45.2 45.8
13:30 EUR ECB’s Gonzalez-Paramo speaks —- —-
15:15 USD Fed’s Lacker speaks —- —-
19:15 USD Fed’s Plosser speaks —- —-
19:40 USD Fed’s Evans speaks —- —-
09:00 ZAR Civil cases for debt (Sep) —- 20.8% y/y
3
Precious Metals Sales and Trading — London 44-20-7815 4210 RDD:STPM; New York 1-212-407-5102 RDD:STNN; Hong Kong 852-2822-7888 RDD:STDH;
Singapore 65-6533-7086 RDD:STDS; Dubai 971-4-330 0011 RDD: SBDB; Tokyo 81-3-4520-6002 SDD:STDJ; Reuters prices SBLLMETALS
Certification
The analyst(s) who prepared this research report (denoted by an asterisk*) hereby certifies(y) that: (i) all of the views and opinions
expressed in this research report accurately reflect the research analyst's(s') personal views about the subject investment(s) and issuer(
s) and (ii) no part of the analyst’s(s’) compensation was, is or will be directly or indirectly related to the specific recommendations
or views expressed by the analyst(s) in this research report.
Conflict of Interest
It is the policy of The Standard CIB Research Limited and its worldwide affiliates and subsidiaries (together the “Standard CIB Research”)
that research analysts may not be involved in activities in a way that suggests that he or she is representing the interests of
any member of the Standard CIB Research or its clients if this is reasonably likely to appear to be inconsistent with providing independent
investment research. In addition research analysts’ reporting lines are structured so as to avoid any conflict of interests. For
example, research analysts cannot be subject to the supervision or control of anyone in the Standard CIB Research’s investment
banking or sales and trading departments. However, such sales and trading departments may trade, as principal, on the basis of the
research analyst’s published research. Therefore, the proprietary interests of those sales and trading departments may conflict with
your interests.
Legal Entities:
To U. S. Residents
Standard New York Securities, Inc. is registered with the Securities and Exchange Commission as a broker-dealer and is also a member
of the FINRA and SIPC. Standard Americas, Inc is registered as a commodity trading advisor and a commodity pool operator with
the CFTC and is also a member of the NFA. Both are affiliates of Standard Bank Plc and Standard Bank of South Africa. Standard
New York Securities, Inc is responsible for the dissemination of this research report in the United States. Any recipient of this research
in the United States wishing to effect a transaction in any security mentioned herein should do so by contacting Standard New York
Securities, Inc.
To South African Residents
The Standard Bank of South Africa Limited (Reg.No.1962/000738/06) is regulated by the South African Reserve Bank and is an
Authorised Financial Services Provider.
To U.K. Residents
Standard Bank Plc is authorised and regulated by the Financial Services Authority (register number 124823) and is an affiliate of Standard
Bank of South Africa. The information contained herein does not apply to, and should not be relied upon by, retail customers.
General
This research report is based on information from sources that Standard CIB Research believes to be reliable. Whilst every care has
been taken in preparing this document, no research analyst or member of the Standard CIB Research gives any representation, warranty
or undertaking and accepts no responsibility or liability as to the accuracy or completeness of the information set out in this document
(except with respect to any disclosures relative to members of the Standard CIB Research and the research analyst’s involvement
with any issuer referred to above). All views, opinions and estimates contained in this document may be changed after publication
at any time without notice. Past performance is not indicative of future results. The investments and strategies discussed here may
not be suitable for all investors or any particular class of investors; if you have any doubts you should consult your investment advisor.
The investments discussed may fluctuate in price or value. Changes in rates of exchange may have an adverse effect on the value of
investments. This material is not intended as an offer or solicitation for the purchase or sale of any financial instrument. Members of
Standard CIB Research may act as placement agent, advisor or lender, make a market in, or may have been a manager or a comanager
of, the most recent public offering in respect of any investments or issuers referenced in this report. Members of the Standard
CIB Research and/or their respective directors and employees may own the investments of any of the issuers discussed herein and
may sell them to or buy them from customers on a principal basis. This report is intended solely for clients and prospective clients of
members of the Standard CIB Research and is not intended for, and may not be relied on by, retail customers or persons to whom this
report may not be provided by law. This report is for information purposes only and may not be reproduced or distributed to any other
person without the prior consent of a member of the Standard CIB Research. Unauthorised use or disclosure of this document is
strictly prohibited. By accepting this document, you agree to be bound by the foregoing limitations. Copyright 2008 Standard CIB Research.
All rights reserved.