Special: BOA's Gold and Silver Report Broken Down
Market Rundown
Market Rundown
BOA Metals Weekly
Zen Moment: The Dog Did it
1- Market Rundown
Good morning. Markets started out strong today. But ADP Jobs data came out stronger (ADP Private payrolls 497K vs. Exp. 225K) and pulled the rug from under them as traders again started recalibrating more hikes coming.
For stocks and bonds to drop with a weaker dollar can be viewed as a small but resurgent stagflationary sign. We tend to think of it as too many traders running for exits at one time, at least for now.
2- BOA Metals Weekly
The Bank’s Summary:
Gold pushed above $2,000/oz in 2Q23, partially because the Fed was perceived to have reached the end of the hiking cycle. But with scope for another two policy rate increases, the yellow metal should remain capped for now.
Silver will likely be supported by demand from solar panel and EV producers, but prices are unlikely to make meaningful headway until demand from traditional industrial sectors accelerates as the global economy bottoms out in 2024. Platinum fundamentals are set to be strong given South Africa’s production issues and rising demand from the auto industry.
Palladium is a onetrick pony, with 90% of demand related to cars with a combustion engine. With the energy transition gathering pace, we see structural headwinds for the precious metal.
We’re not going to make too much of this report. Not because it is inaccurate, it is a good one. Just that in terms of price activity this is not the time of year to be getting emotional either way.
However we welcome reports from reputable firms as they show the industry is being taken seriously again. More specifically, BOA is looking at Silver within the Green metal complex. It is also looking at Gold as a beneficiary of Green metal awareness since Gold miners are now looking to add Copper production. These are all early signs of an improving industrial outlook. Especially against the backdrop of what seems to be a new M&A cycle in metals.
The parallel here is similar to when a bank starts covering a stock. Others follow suit and more interest comes from it. Raising awareness is a positive.
Here is a breakdownof BOA’s Weekly Gold and Silver report in that green context.
Continues at BOTTOM with full report…
