Thanks. I have a small long calls position in NEM. Here's an article on yesterday's action in gold.
Gold on rise after government report
By Myra P. Saefong, CBS.MarketWatch.com
4:10 PM ET Jan 22, 2001
NEW YORK (CBS.MW) -- Shares of gold companies and gold futures prices both rallied Monday, a
trading day after a report from a federal regulatory agency revealed an increase in trader short
positions.
The "primary driver" for the rally in gold prices and gold stocks is "short covering," said Chad
Williams, a Toronto-based analyst for TD Securities.
Noncommercial traders have increased their short positions, he said, citing a Commodity Futures
Trading Commission report released Friday. A short position occurs when a trader has sold futures
contracts but has yet to offset the sale.
The number of short positions in the market is the biggest since September 1999, Williams said, so the
report provided an "important piece of news" and "made some of investors who are short nervous."
In the equities markets, the CBOE Gold Index (GOX: news, msgs) climbed by 9.4 percent to 35.34.
The Philadelphia Gold and Silver Index (XAU: news, msgs) rose to 51.99, up 6.3 percent.
Individually, shares of Placer Dome Gold (PDG: news, msgs) added 81 cents to close at $9.50 and
shares of Agnico-Eagle Mines (AEM: news, msgs) rose 75 cents to $6.81.
Gold futures close higher
Williams also attributed the rise in gold stocks and prices to "position squaring" ahead of a U.K. gold
auction.
On Tuesday, the Bank of England will sell 25 metric tons of gold in the fifth gold auction in a series of
six through which it'll sell a total of 150 metric tons.
At the previous auction, held Nov. 7, the U.K. sold its designated amount of gold for $264.30 an
ounce, with the bidding 3.3 times oversubscribed.
February gold rose by $2.10 to close at $267 an ounce on the Commodities Exchange division of the
New York Mercantile Exchange. March silver rose 2.5 cents to $4.805 an ounce.
On Friday, COMEX gold warehouse stocks were flat at 1,775,330 ounces. Silver stocks were also
unchanged, at 93,378,330 ounces.
Meanwhile, the price of March palladium increased by $12.70 to $1,075.20 an ounce and April
platinum rose by $4 to $619.80 an ounce.
March copper closed flat at 84.75 cents a pound. London Metals Exchange warehouse stocks fell 875
metric tons to 356,950 metric tons as of early Monday. Late Friday, COMEX stocks were up 821
short tons to 70,910 tons.
www2.marketwatch.com |
