Best of the Week
Most Popular
1. US Housing Market House Prices Bull Market Trend Current State - Nadeem_Walayat
2.Gold and Silver End of Week Technical, CoT and Fundamental Status - Gary_Tanashian
3.Stock Market Dow Trend Forecast - April Update - Nadeem_Walayat
4.When Will the Stock Market’s Rally Stop? - Troy_Bombardia
5.Russia and China Intend to Drain the West of Its Gold - MoneyMetals
6.BAIDU (BIDU) - Top 10 Artificial Intelligence Stocks Investing To Profit from AI Mega-trend - Nadeem_Walayat
7.Stop Feeding the Chinese Empire - ‘Belt and Road’ Trojan Horse - Richard_Mills
8.Stock Market US China Trade War Panic! Trend Forecast May 2019 Update - Nadeem_Walayat
9.US China Trade Impasse Threatens US Lithium, Rare Earth Imports - Richard_Mills
10.How to Invest in AI Stocks to Profit from the Machine Intelligence Mega-trend - Nadeem_Walayat
Last 7 days
Global Economic Tensions Translate Into Oil Price Volatility - 22nd May 19
The Coming Pension Crisis Is So Big That It’s a Problem for Everyone - 22nd May 19
Crude Oil, Hot Stocks, and Currencies – Markets III - 22nd May 19
The No.1 Energy Stock for 2019 - 22nd May 19
Brexit Party and Lib-Dems Pull Further Away from Labour and Tories in Latest Opinion Polls - 22nd May 19
The Deep State vs Donald Trump - US vs Them Part 2 - 21st May 19
Deep State & Financial Powers Worry about Alternative Currencies - 21st May 19
Gold’s Exciting Boredom - 21st May 19
Trade War Fears Again, Will Stocks Resume the Downtrend? - 21st May 19
Buffett Mistake Costs Him $4.3 Billion This Year—Here’s What Every Investor Can Learn from It - 21st May 19
Dow Stock Market Trend Forecast 2019 May Update - Video - 20th May 19
A Brief History of Financial Entropy - 20th May 19
Gold, MMT, Fiat Money Inflation In France - 20th May 19
WAR - Us versus Them Narrative - 20th May 19
US - Iran War Safe-haven Reasons to Own Gold - 20th May 19
How long does Google have to reference a website? - 20th May 19
Tory Leadership Contest - Will Michael Gove Stab Boris Johnson in the Back Again? - 19th May 19
Stock Market Counter-trend Rally - 19th May 19
Will Stock Market “Sell in May, Go Away” Lead to a Correction… or a Crash? - 19th May 19
US vs. Global Stocks Sector Rotation – What Next? Part 1 - 19th May 19
BrExit Party EarthQuake Could Win it 150 MP's at Next UK General Election! - 18th May 19
Dow Stock Market Trend Forecast 2019 May Update - 18th May 19
US Economy to Die a Traditional Death… Inflation Is Going to Move Higher - 18th May 19
Trump’s Trade War Is Good for These 3 Dividend Stocks - 18th May 19
GDX Gold Mining Stocks Fundamentals Update - 17th May 19
Stock Markets Rally Hard – Is The Volatility Move Over? - 17th May 19
The Use of Technical Analysis for Forex Traders - 17th May 19
Brexit Party Set to Storm EU Parliament Elections - Seats Forecast - 17th May 19
Is the Trade War a Catalyst for Gold? - 17th May 19
This Is a Recession Indicator No One Is Talking About—and It’s Flashing Red - 17th May 19
War! Good or Bad for Stocks? - 17th May 19
How Many Seats Will Brexit Party Win - EU Parliament Elections Forecast 2019 - 16th May 19
It’s Not Technology but the Fed That Is Taking Away Jobs - 16th May 19
Learn to Protect your Forex Trading Capital - 16th May 19
Gold Ratio Charts Offer The Keys to the Bull Market - 16th May 19
Is Someone Secretly Smashing the Stock Market at Night? - 16th May 19

Market Oracle FREE Newsletter

U.S. House Prices Analysis and Trend Forecast 2019 to 2021

Gold Drops as Japan's Nuclear Panic Hits Global Stock Markets

Commodities / Gold and Silver 2011 Mar 15, 2011 - 08:04 AM GMT

By: Adrian_Ash


THE PRICE OF GOLD fell 3% against a rising US Dollar on Tuesday morning, bouncing from a 4-week low of $1384 per ounce as world stock-market and commodity prices sank on news of radiation leaks from Japan's earthquake-hit nuclear plants.

Tokyo's Nikkei index closed Tuesday down at a 22-month closing low, slumping nearly 11% for the day as officials advised people within 30 miles of the Fukushima Daiichi facility to stay indoors.

Austria was reported to be moving its embassy south-west from Tokyo – which is some 150 miles from the stricken nuclear site – where supermarkets have been stripped bare of food, flashlights and daily necessities.

New York's stock markets opened the day nearly 3% down as Germany's Dax index traded nearly 5% lower and London's FTSE-100 lost 2.6%, dropping to new 2011 lows.

The gold price in Euros, Sterling and Japanese Yen lost 2.0% overnight, falling towards 4-week lows.

"Be it due to margin calls [on other assets] or risk averseness," says one Asian dealer, "the financial markets suffered a meltdown [that] spilled into the metals."

With Japanese car production still shut by the disaster, auto-catalyst metals platinum and palladium fell 2.3% and 3.9% by today's AM Fix in London, hitting fresh 2011 lows after what one Hong Kong trader called "panicky sales" by private investors in the Tokyo market.

Wholesale silver bullion prices fell through last Friday's trough of $34 per ounce to hit a two-week low, down more than 5% from the start of today's Asian trade.

"We saw not only selling of equities, but also panic-selling of gold, silver, platinum and palladium in Japan today," writes James Zhang at Standard Bank.

Brent crude meantime oil lost $4.75 per barrel to $109, leading a 2% drop in the broad commodity markets.

Amid the Japanese earthquake and nuclear shocks, gold investment "has not been acting as much as a safe haven as other safe-havens," notes Matthew Turner at Mitsubishi, "but it's also not been acting as much as a commodity as other commodities."
"It's not unusual for gold to tumble during initial episodes of a severe broad asset sell-off," adds Dr.Edel Tully at UBS, also quoted by Reuters.

Further ahead, "Friday’s disaster in Japan will be negative for economic growth," says Zhang at Standard Bank, and "a slump in growth in the world’s third-largest economy may have a substantial impact on the outlook for global monetary policy.

"It may move monetary tightening into the future. If so, it would be bullish for especially gold."

Major-economy government debt prices jumped as stock and commodity markets sank, driving 10-year US Treasury yields down more than 0.12% to a three-month low of 3.23%.

BNP Paribas analysts note today that Japan is China's top trading partner, accounting for 13% of imports, with hi-tech, plant and machinery dominating.

By Adrian Ash

Gold price chart, no delay   |   Buy gold online at live prices

Formerly City correspondent for The Daily Reckoning in London and a regular contributor to MoneyWeek magazine, Adrian Ash is the editor of Gold News and head of research at , giving you direct access to investment gold, vaulted in Zurich , on $3 spreads and 0.8% dealing fees.

(c) BullionVault 2011

Please Note: This article is to inform your thinking, not lead it. Only you can decide the best place for your money, and any decision you make will put your money at risk. Information or data included here may have already been overtaken by events – and must be verified elsewhere – should you choose to act on it.

© 2005-2019 - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.

Post Comment

Only logged in users are allowed to post comments. Register/ Log in

6 Critical Money Making Rules