Gold Prices At 7-yr high After Iran Missile Strike, Pull Back.

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Kitco , Wed. Jan. 8th, 2017)  – Gold and silver prices are near steady in early U.S. futures trading Wednesday, and are way down from their overnight spike highs that were produced by an Iranian missile strike near U.S. troops in Iraq. February gold futures hit a nearly seven-year high of $1,613.30 overnight, while silver scored a more-than-three-month high of $18.895. February gold futures were last down $0.50 an ounce at 1,573.90. March Comex silver prices were last down $0.073 at $18.315 an ounce. 

Global markets that were open Tuesday evening U.S. time were rocked when Iran launched at least a dozen missiles at military bases in Iraq where U.S. troops were stationed. Iran immediately claimed responsibility for the attacks, which it called “hard revenge” for the U.S. killing of its leading military general last week. Reports say there are no U.S. casualties. President Trump tweeted “all is well” and said he would have more to say today. At first blush, it appears the Iranian leadership launched the missiles to appease Iranian citizens who were calling for revenge. However, it also appears Iran did not want to kill Americans which would then likely see a massive U.S. retaliation. Military analysts believe Iran’s missiles are accurate enough to have inflicted more loss of human life, if that’s what Iran’s leaders wanted. But that’s still just speculation. Reports said Iranian officials even warned the U.S. the strikes were coming. Iran’s leadership did say the missile attacks were “proportionate” and said they did not want an escalation of the conflict. The wildcard is, how will Trump respond? The marketplace Wednesday morning is acting like this situation will de-escalate from here, at least for the near term. That’s why gold and silver prices have backed well down from their overnight spike highs.

Crude oil prices spiked to a nine-month high of $65.65, basis Nymex crude oil futures. U.S. Treasury prices rallied on the initial news, while U.S. stock indexes sold off sharply. However, once it appeared there were no U.S. casualties in the Iranian attack, global markets began to settle down. Asian and European stock markets were weaker overnight.

Right now, U.S. stock indexes are pointed toward slightly firmer openings when the New York day session begins. Nymex crude oil prices are trading weaker and around $62.00 a barrel and the U.S. dollar index is modestly up.

The other news overnight is the crash of a Ukrainian Boeing 737 jet airliner in Iran that killed over 170 people. Right now, Iranian authorities are saying the cause of the crash is mechanical issues. This plane was not the 737 Max that has been grounded for almost a year. 

U.S. economic data due for release Wednesday includes the weekly MBA mortgage applications survey, the ADP national employment report, and the weekly DOE liquid energy stocks report.

Posted by :

Jack Dempsey, President

401 Gold Consultants LLC

jdemp2003@gmail.com