BullMarketRun.com

Gold has traded between $1,210 and $1,219 so far today…as of 10:30 am Pacific, bullion is up $2 an ounce at $1,210…Silver is off 4 cents at $16.51…Copper has climbed 6 pennies to $2.51…Nickel has soared 25 cents to $5.13…Crude Oil has jumped more than $2 a barrel to $47.73 while the U.S. Dollar Index has retreated one-fifth of a point to 101.18…

Holdings of the world’s biggest Gold-backed exchange-traded fund, SPDR Gold Shares, slid more than 19 tonnes last week, its biggest weekly outflow in 4 months…

Currency movements have apparently played a role in Gold purchases by key Gold-buying central banks such as Russia and China, Commerzbank points out…analysts cite news reports that the Russian central bank bought around 40 tonnes of Gold in October, the biggest monthly Gold purchase of this millennium.  “Clearly, the central bank was taking advantage of the stronger ruble – which has made Gold cheaper in local currency – to buy more Gold,” Commerzbank says.  “By contrast, the Chinese central bank bought only around 4 tonnes of Gold last month – the second-lowest Gold purchases since China began publishing monthly figures back in June 2015.  The currency is likely to have played a role here, too – the yuan has been depreciating noticeably since the end of September.” 

If the Chinese currency continues to weaken, expect President-elect Trump to weigh in heavily on that issue as he accused the Chinese of currency manipulation throughout his campaign…

Adrian Day, Chairman & CEO of Adrian Day Asset Management, sees Gold responding well under a Trump presidency due to increased spending, including infrastructure and defense, big tax cuts and less regulation – all combining to create a more pro-growth economy with an inflationary bias.  “With regard to Yellen’s threat for a more ‘hawkish’ Fed to counter-balance fiscal profligacy, we would retort, ‘I knew (former Fed Chair) Paul Volker, and she’s no Paul Volker.  We do not expect sharply higher rates, and further out we will likely see higher U.S. debt (already high) and higher inflation (already stirring).  So the outlook a little further out – combined with easy money around the world, stronger Indian demand, possible geopolitical turmoil, and a decline in mine production – will be a higher Gold price.”

Deutsche Bank:  S&P 500 Will Rally Over Next 2 Years To 2500

Deutsche Bank strategist David Bianco says the market will rally over the next 2 years on optimism about President-elect Trump’s economic agenda.  “We think the market is under appreciating the likely big boost to S&P EPS from a lower corporate tax rate and the boost to bank profits from rising yields (and lower pension expense) and the much higher chance now of a long-lasting economic expansion that rivals the 10-year U.S. record.  We’re more confident now that the S&P will reach 2500 in 2018 before suffering its next bear market.”

Fed’s Burden Reduced:  Fischer

While much of the elitist and liberal mainstream media still hasn’t come to terms with a Trump presidency, and probably never will, the Federal Reserve’s second-in-command understands how a Trump White House and a Republican-controlled Congress will fill the “fiscal vacuum” that has plagued Washington for a number of years…Stanley Fischer is the latest to wade into a post-election debate over what policies the new U.S. government should pursue, saying today that spending and other efforts to boost sluggish productivity could help reduce the Fed’s burden of supporting the economy…

“Certain fiscal policies, particularly those that increase productivity, can increase the potential of the economy and help confront some of our longer-term economic challenges.  Some combination of improved public infrastructure, better education, more encouragement for private investment, and more effective regulation all likely have a role to play in promoting faster growth of productivity and living standards,” he said at the Council on Foreign Relations…

Crude Oil Update

Crude Oil prices are recovering, thanks to OPEC’s de facto leader Saudi Arabia undertaking a diplomatic charm offensive since last week to persuade the group’s more reluctant members to join its proposed output cut…the way we see it, if the Saudis want a cut – and it seems they do – they’ll get one…

Meanwhile, Russian leader Vladimir Putin says he sees no obstacle to non-OPEC member Russia agreeing to freeze Oil output which at more than 11 million barrels per day is at a post-Soviet high…

Barclays on Crude:  “We expect OPEC to agree to a face-saving statement…(but) U.S. tight Oil producers can grow production at $50-$55 (per barrel) and will capitalize on any opportunity afforded to them by an OPEC cut.”

Gold Fields Steps Back (Temporarily?) From Attempt To Acquire Kirkland Lake Gold

Gold Fields (GFI, NYSE) and Silver Standard Resources (SRO, TSX, NASDAQ) have withdrawn their latest joint proposal to acquire all of the outstanding shares of Kirkland Lake Gold (KLG, TSX) in a negotiated transaction.  “In light of the lack of engagement by the board of Kirkland Lake in response to these proposals, and there being no basis to expect any further engagement from Kirkland Lake, Gold Fields and Silver Standard are left with no choice but to withdraw their latest proposal,” Gold Fields announced, adding it “remains interested in pursuing negotiations toward a board-supported transaction with Kirkland Lake in the event that Kirkland Lake’s shareholders reject the Newmarket transaction.”