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A Flat Day for Precious Metals: What’s Ahead?

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Flat day for precious metals

Precious metals had a slow day on Tuesday, October 3, 2017. They traded almost flat, falling only minimally and maintaining the downward sentiment. Gold futures for November expiration were 0.08% lower than the previous day, ending up at $1,273.10 per ounce. Silver was a marginal 0.02% lower, ending at $16.70, the same as Monday. Platinum also witnessed a small fall of 0.05%. Palladium was the only precious metal that gained, rising 0.61% and ending at $911.50 per ounce.

The above chart depicts the movements of gold and silver over the past month. The gold and silver-based funds are the iShares Gold Trust (IAU) and the iShares Silver Trust (SLV). They fell 1.9% and 1.3%, respectively, over the past five trading days. They’re known to closely follow precious metals.

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Miners get a boost

Although precious metals were flat, most mining stocks had an up day on Tuesday, October 3. Among the top gainers that day were Harmony Gold (HMY), Buenaventura Mining (BVN), Sibanye Gold (SBGL), and AuRico Gold (AUQ). These four miners rose 2.2%, 3.1%, 5.2%, and 3.6%, respectively, on Tuesday. Together, they make up 7.4% of the fluctuations in the VanEck Vectors Gold Miners ETF (GDX).

We need to remember that the US dollar has also had a considerable role in the fall of precious metals over the past month. The rise of the dollar hurts precious metals since they are dollar-denominated assets. The fall of the dollar usually leads to an eventual fall in mining shares.

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