Precious metals, after opening up on Monday in less than impressive fashion, are adding some good value on Tuesday thanks to a sell-off of US stocks. Recently, volatility on the part of equity markets has laid the path for a rise in safe-haven demand for gold and silver, and that is exactly what we are seeing today.
In general, this week is not expected to bring about too much in the way of economic data, but that much was not really true today. The reason for that being that the US was dealt some quarterly earnings reports from the last quarter of 2014. As we look ahead to the next three days of the trading week, I expect that investors will continue to closely analyze whatever data is thrown their way.
Disappointing Earnings Reports Spark Stock Market Sell-Off
Today brought about a good deal of corporate earnings reports, and much to the surprise of everyone, most of them were on the downbeat side of things. Construction company Caterpillar declined throughout 2014’s fourth quarter and reported significantly smaller profits than were expected. With some mines operating at less than full-capacity, Caterpillar’s struggles were none too unusual.
Other big losers included tech giant Microsoft and Proctor & Gamble, who cited a stronger US Dollar as having hurt overseas profits. This is just a small cross-section of the reports dished out today, but it does a good job of painting the overall picture. The Dow is set for its biggest single-day loss since October. For precious metals, today has seen spot values more or less recover the value that was lost on Monday. Whether that will carry out as the week moves forward, however, remains to be seen. Generally, the market is a bit more bullish on metals now than they were a few months ago, so the hope is that gold and silver will bounce back from today’s poor day.
In other news, the marketplace has once again concerned itself with things that are going on in Greece. Seeing as the anti-austerity Syriza party won parliamentary elections by a wider margin than was expected, investors are curious as to how the EU’s financial struggles will play out. After all, Greece is due for another batch of stimulation funds by the time Summer rolls around, so it is best that the powers that be figure this out, to some extent, sooner rather than later.