Retail sales depress markets
The stock market rout from China sent shock waves throughout US and other equity markets worldwide. US economic data on retail sales also played its game on precious metals. On Friday, January 15, 2016, gold rose from its previous trading session as US stock indexes were pressured downward. This came as retail sales fell 0.1% in the last month of 2015.
Retail sales measure the change in the price of goods and services sold by the producers. The PPI (Producer Price Index) slipped 0.2% in December 2015. The fall in these crucial economic data figures strengthened gold and silver prices, which are trading at $1,090.70 and $13.90 per ounce, respectively.
Below is the three-day pivot chart for gold. It shows the pre-retail sales data price movement in gold futures prices.
The US dollar
Retail sales data also weighed down the US dollar. The US Dollar Index, which prices the dollar against the six major world currencies, fell 0.13%. The fall in the US dollar gave a further boost to dollar-denominated gold and silver, pushing them higher. Gold and silver have been the best-performing assets during this global rout and uncertain times.
Platinum and palladium, however, fell 0.87% and 0.85%, respectively. The rise and fall in precious metals have left mining companies unstable. A few miners are seeing alternate days of gains and losses.
The biggest losers during the past five trading days include Eldorado Gold (EGO), Alamos Gold (AGI), B2Gold (BTG), and Royal Gold (RGLD). These four stocks fell 29.9%, 26.2%, 24.4%, and 24.5%, respectively. Together, they make up about 11% of the price changes in the VanEck Vectors Gold Miners ETF (GDX). GDX fell 9.9% during the past five trading days.