Weekly Market Report 04/16/12

This week’s Market Report provides you with an update on the precious metal markets and announces that the newest issue of CoinStats is now available. CoinStats is an in-depth statistical analysis of U.S.$20 Gold and Silver Dollar rare coins, which allows investors to identify the best values in certified rare coins.

GOLD

Last week was just another volatile week in global precious metal trading, with a $50 per ounce High /Low trading range. Gold ended the week up $30 per ounce, closing Friday at $1,660.20 per ounce, up 5.83% since the beginning of the year.  Gold is still at the low end of its nine month trading range ($1,535 to $1,920) and represents excellent value. I expect a minimum of a 20% return in 2012, the same average appreciation for the past 11 years. 

Physical Gold Demand in Asia continues to increase.

Physical demand for gold in India is expected to pick up again now that Indian jewelry shops have ended a strike. “A majority of India’s jewelers closed their shops for roughly three weeks to protest a doubling of the import tax on gold from 2% to 4%, and the introduction of an excise tax of 1% on unbranded gold jewelry. The majority of India’s jewelry industry is comprised of small shops and an excise tax is viewed as more onerous for smaller jewelry stores to comply with, according to Indian merchants,” said Jim Steel, an analyst with HSBC.

India, along with China, is one of the world’s two largest consumers of gold. The end of the strike comes at a key time, with the approach of India’s gift-giving Akshaya Tritiya festival on April 24. Buying valuables such as gold jewelry on this day, and giving them as gifts, is considered to bring extensive religious merit, luck, and success.

In February, mainland China bought 39,668 kilograms of gold (39.668 metric tons), up from 32,948 kilograms in January (a 20% increase), according to export data from the Census and Statistics Department of the Hong Kong government.

Standard Banks recent forecast

On Tuesday, Standard Bank forecast gold prices to average $1,790 an ounce in 2012."Over the short term, we concur with the caution evident in the current futures market and ETF positioning," the bank said in a note to clients. However, the bank also said it expects the prices to move higher, most likely in the second half of 2012.

Morgan Stanley forecasts

In the face of the Federal Reserve’s recent statement, which drove the gold prices down to $1,612 per ounce, Morgan Stanley forecasts that the gold prices will climb to $2,175/oz by 2013 with prices depending on 4 bullish factors: 1) the decline in producer hedging 2) the decline of developed market central bank sales 3) the inability of gold mines to increase gold supplies materially and 4) the long term growth in physical investment demand.

SILVER

Silver continues to show excellent support at $31.00 per ounce, closing last Friday at $31.39 per ounce, down $0.34.  With the exception of Thursday April 12th, when silver rallied $1 per ounce and reached $32.58 per ounce, Silver has closed between $31.39 to $31.67 per ounce.

Last week the Silver and Platinum price did not take direction from the Gold market, closing lower on the week in the face of a 2% increase in gold.

PLATINUM

Last week Platinum was down $20, closing the week at only $1,587.60 per ounce, at a $72.30 discount to the gold price. This provides you an opportunity to purchase Platinum at a discount to Gold. Great timing, as the new 2012 1oz Platinum Maple Leafs were just released. The Canadian 1oz Platinum Maple Leaf is the most active platinum trading vehicle. For a current quote on this item please visit: http://www.mintstategold.com/platinum-1/bullion-coins-and-bars/platinum-canadian-maple-leafs.html

The new April 2012 CoinStats is now available

My numismatic CoinStats report is the best investment tool for rare coin investors. CoinStats is an in-depth statistical analysis of popular rare coin series which allows you to identify the best values in certified rare coins. I am proud to offer this unique and informative tool exclusively for our clients. The April 2012 CoinStats update is now available for $20 Gold Saint Gaudens, $20 Gold Liberties, and the Morgan & Peace Silver Dollar series.

The CoinStats Report provides a list of my recommended certified US gold and silver coins which are listed on the best value page.  These are not the overly hyped modern issue bullion coins or low grade circulated coins, they are PCGS/NGC Certified MS63 or higher gold and silver U.S. rare coins, dated prior to 1936, that have a proven track record of appreciation.

For the latest CoinStats analysis, just put CoinStats in the subject line and email me with which series you would like to see.

RARE COIN UPDATE

This week I am attending the Central States Numismatic Society, in Schaumburg, IL. This is a major coin convention attended by thousands of dealers, investors, and collectors. I plan to focus my attention on purchasing graded MS63 and higher U.S. $20 Gold Liberties & Saints, and Morgan & Peace Silver Dollars. Supplies have been thin lately, primarily because most dealers’ inventory levels are low now, and they are aggressive buyers. Investment quality high end gold and silver rarities are always on my want list. 

Recommended investment commitment and diversification:

Precious Metal commitment: Minimum of 35% of investment capital

Diversification:  Gold 50%, Silver 40%, Platinum & Palladium 10%

Diversification includes 50% in long term investment quality rare coins and 50% short term bullion products

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All statements, opinions, pricing, and ideas herein are believed to be reliable, truthful and accurate to the best of the Stuppler & Company’s knowledge at this time.  Stuppler & Company disclaims and is not liable for any claims or losses which may be incurred by third parties while relying on information published herein.  Individuals should not look at this publication as giving finance or investment advice or information for their individual suitability.  All readers are advised to independently verify all representations made herein or by its representatives for your individual suitability before making your investment or collecting decisions.