Gold, Silver, Metal Prices: Commentary – 11/30/2009

C.A.R. & Drivers

Good Day,

The Dubai-based financial sandstorm that roiled the markets late last week showed some signs of dissipating as the new trading week got underway. While the Dubai finance minister indicated that the emirate will not guarantee anything when it comes to local banks, such banks appeared to receive verbal support from Abu Dhabi. The UAE’s stepping up to the plate to support institutions that have exposure to what was to be the ultimate amalgam of Disneyworld/Las Vegas ultimately led to a bounce in emerging market stocks and a resumption of the trend in the dollar and commodities.

As Monday’s markets got underway, the US dollar had broken back to under the 75 mark on the trade-weighted index and had slipped to the 1.50 level against the euro as well. Oil prices did not manage to recoup much of their Friday losses, but equity markets appeared promising in the wake of a 264-point gain in the Nikkei overnight, and judging by a bounce in the emerging market indices.

Gold’ scary $60 Friday range gave way to a more moderate pattern to Monday morning’s initial price action. The yellow metal appeared to manage to hold support at the $1168 trend line and while uncertainty persisted in the marketplace even as the imminent threat of Dubai default appeared to recede, traders were back at work to deal with pressing matters such as the December futures contracts’ expiration.

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