Precious metals were able to gain some traction to end the week, however the week as a whole has not been very kind to metals. Being that this is the last trading week in September, there was a good bit of economic data to mull over and discuss. What’s more, the first presidential debate between Hillary Clinton and Donald Trump happened this week and got a bit of a reaction from investors the world over.
As was just mentioned, the US presidential election took place earlier this week and it quickly was touted as being the most-watched in debate history. We could go on and on about the specifics of the debate, but when the dust finally settled it was both teams who were claiming victory. As for what unbiased sources were saying, Hillary Clinton appeared to edge out Trump due to her preparedness and coolness under pressure. As such, gold and silver did not emit much of a reaction and instead faced a bit of selling pressure.
The reason for this is simple. A Hillary Clinton presidential victory means that the economic and trading spheres of the US will remain mostly unchanged. A Trumpy victory, on the other hand, is seen as being something that brings about more uncertainty than anything else. With his fiery rhetoric and promises for big change to trade laws, Trump’s gaining ground is quite simply something the investing world is afraid of. That’s why, in the wake of the debate, metals more or less spun their wheels.
Even though the first debate has very little impact on the election itself, investors are treating it as though it is pivotal. With 2 more debates still upcoming, it will be interesting to see what happens.
As was mentioned in the opening of this piece, this week has brought with it a lot of economic data from the United States, some of which was ignored and some of which that really caught the attention of the investing world. For one, the weekly jobless claims data came back and showed that last week saw 3,000 more people apply for first-time unemployment benefits. This brought the seasonally-adjusted average number of claims to 254,000. While the increase was by no means a good thing, investors mostly failed to react to the data simply because any seasonally-adjusted average below 300,000 is generally viewed as a good thing. Now, if claims continue to rise over the coming weeks that story might change, but for now this is but one rise in the face of an almost consistent decline in the numbers of people seeking unemployment benefits.
The housing market in the US was delivered a blow of sorts on Thursday as the National Association of Realtors Pending Home Sales Index from August was released. Falling by more than 2%, investors were taken aback at how poorly some of the most recent housing data has been. With fewer houses on the market and the price of those available houses on the rise, sales are beginning to sputter.
The news regarding the US economy was not all bad, however, as consumer confidence was reported as being noticeably higher. According to the US Conference Board, US consumer confidence in September was roughly 3% better than it was the month before. With the employment sector beginning to strengthen, US consumers feel a bit better about what the future has in store for them. With that said, wages appear to be stagnating more than anything else, and that is not such good news.
All in all, this was yet another lackluster week for gold and silver. As we look ahead to next week, you can expect even more economic data to be dealt. Considering the 3rd quarter of 2016 is about to come to a conclusion, there are going to be a multitude of very noteworthy reports. What this means for gold and silver, however, is tough to say at this point.
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