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Gold plummets as global equities markets surge – Kitco NEWS

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Strong equity performance globally resulted in a major selloff in gold. The global rally in equities began last night in China. The underlying factor was action by China’s central bank. The People’s Bank of China (PBC) added huge amounts of capital last night through open market operations in attempts to offset the lack of confidence because of the coronavirus outbreak.

According to Yahoo finance, “The remarks were published on the official WeChat account of the People’s Bank of China (PBOC) after it injected a total of 1.7 trillion yuan ($242.74 billion) via reverse repos on Monday and Tuesday.”

Fears about the coronavirus epidemic resulted in both Chinese equities and commodities selling off aggressively on Monday. In that short period of time those fears eradicated roughly $393 billion in the Chinese stock market capitalization.

The result was a rally in Chinese equities which spilled over into the European stock market, and then into US equities. The Dow Jones Industrial Average gained over 400 points in trading today, and as of 4:22 PM EST is currently fixed at 28,807.63.

Obviously, this global rally in equities created an extremely strong-risk on market sentiment, which in turn put tremendous selling pressure on the safe haven asset class, with gold having the greatest percentage drawdown on the day of the precious metals complex.

Gold futures basis the most active April contract is currently at $1557.60, after trading down $24.70, which is a drop of 1.57%. Although dollar strength was a component of today’s selloff, it accounted for only a small percentage of today’s total decline. Currently the dollar index is up 0.17% and fixed at 97.79.

Spot gold also sold off sharply, and is currently fixed at $1554.10 after factoring in today’s $22.40 decline. On closer inspection we can see that that selloff was a direct result of traders bidding the precious yellow metal lower which accounted for $20.50 of today’s decline. The remaining decline of $1.90 is a direct result of dollar strength, this according to the Kitco Gold Index (KGX).

Unlike yesterday’s lower pricing in gold, today’s sharp decline definitively caused technical chart damage. The support trendline we have been looking at which is based upon the low achieved mid-January at $1536, and drawing a line from there based upon a series of higher lows. Today gold prices broke below that trendline indicating the potential for further declines in gold.

Our technical studies indicate that the first level of support does not occur until $1530, which is a 50% retracement of the rally which took gold pricing as high as $1613. Below that price point is major support at $1511.50, which is at the 61.8% Fibonacci retracement level.

For those who would like more information, simply use this link.

Wishing you as always, good trading,

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Carry On Canadian Business. Carry On!

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business to start in Canada

Human Resources Officers must be very busy these days what with the general turnover of employees in our retail and business sectors. It is hard enough to find skilled people let alone potential employees willing to be trained. Then after the training, a few weeks go by then they come to you and ask for a raise. You refuse as there simply is no excess money in the budget and away they fly to wherever they come from, trained but not willing to put in the time to achieve that wanted raise.

I have had potentials come in and we give them a test to see if they do indeed know how to weld, polish or work with wood. 2-10 we hire, and one of those is gone in a week or two. Ask that they want overtime, and their laughter leaving the building is loud and unsettling. Housing starts are doing well but way behind because those trades needed to finish a project simply don’t come to the site, with delay after delay. Some people’s attitudes are just too funny. A recent graduate from a Ivy League university came in for an interview. The position was mid-management potential, but when we told them a three month period was needed and then they would make the big bucks they disappeared as fast as they arrived.

Government agencies are really no help, sending us people unsuited or unwilling to carry out the jobs we offer. Handing money over to staffing firms whose referrals are weak and ineffectual. Perhaps with the Fall and Winter upon us, these folks will have to find work and stop playing on the golf course or cottaging away. Tried to hire new arrivals in Canada but it is truly difficult to find someone who has a real identity card and is approved to live and work here. Who do we hire? Several years ago my father’s firm was rocking and rolling with all sorts of work. It was a summer day when the immigration officers arrived and 30+ employees hit the bricks almost immediately. The investigation that followed had threats of fines thrown at us by the officials. Good thing we kept excellent records, photos and digital copies. We had to prove the illegal documents given to us were as good as the real McCoy.

Restauranteurs, builders, manufacturers, finishers, trades-based firms, and warehousing are all suspect in hiring illegals, yet that becomes secondary as Toronto increases its minimum wage again bringing our payroll up another $120,000. Survival in Canada’s financial and business sectors is questionable for many. Good luck Chuck!. at least your carbon tax refund check should be arriving soon.

Steven Kaszab
Bradford, Ontario
skaszab@yahoo.ca

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Imperial to cut prices in NWT community after low river prevented resupply by barges

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NORMAN WELLS, N.W.T. – Imperial Oil says it will temporarily reduce its fuel prices in a Northwest Territories community that has seen costs skyrocket due to low water on the Mackenzie River forcing the cancellation of the summer barge resupply season.

Imperial says in a Facebook post it will cut the air transportation portion that’s included in its wholesale price in Norman Wells for diesel fuel, or heating oil, from $3.38 per litre to $1.69 per litre, starting Tuesday.

The air transportation increase, it further states, will be implemented over a longer period.

It says Imperial is closely monitoring how much fuel needs to be airlifted to the Norman Wells area to prevent runouts until the winter road season begins and supplies can be replenished.

Gasoline and heating fuel prices approached $5 a litre at the start of this month.

Norman Wells’ town council declared a local emergency on humanitarian grounds last week as some of its 700 residents said they were facing monthly fuel bills coming to more than $5,000.

“The wholesale price increase that Imperial has applied is strictly to cover the air transportation costs. There is no Imperial profit margin included on the wholesale price. Imperial does not set prices at the retail level,” Imperial’s statement on Monday said.

The statement further said Imperial is working closely with the Northwest Territories government on ways to help residents in the near term.

“Imperial Oil’s decision to lower the price of home heating fuel offers immediate relief to residents facing financial pressures. This step reflects a swift response by Imperial Oil to discussions with the GNWT and will help ease short-term financial burdens on residents,” Caroline Wawzonek, Deputy Premier and Minister of Finance and Infrastructure, said in a news release Monday.

Wawzonek also noted the Territories government has supported the community with implementation of a fund supporting businesses and communities impacted by barge cancellations. She said there have also been increases to the Senior Home Heating Subsidy in Norman Wells, and continued support for heating costs for eligible Income Assistance recipients.

Additionally, she said the government has donated $150,000 to the Norman Wells food bank.

In its declaration of a state of emergency, the town said the mayor and council recognized the recent hike in fuel prices has strained household budgets, raised transportation costs, and affected local businesses.

It added that for the next three months, water and sewer service fees will be waived for all residents and businesses.

This report by The Canadian Press was first published Oct. 21, 2024.

The Canadian Press. All rights reserved.

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U.S. vote has Canadian business leaders worried about protectionist policies: KPMG

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TORONTO – A new report says many Canadian business leaders are worried about economic uncertainties related to the looming U.S. election.

The survey by KPMG in Canada of 735 small- and medium-sized businesses says 87 per cent fear the Canadian economy could become “collateral damage” from American protectionist policies that lead to less favourable trade deals and increased tariffs

It says that due to those concerns, 85 per cent of business leaders in Canada polled are reviewing their business strategies to prepare for a change in leadership.

The concerns are primarily being felt by larger Canadian companies and sectors that are highly integrated with the U.S. economy, such as manufacturing, automotive, transportation and warehousing, energy and natural resources, as well as technology, media and telecommunications.

Shaira Nanji, a KPMG Law partner in its tax practice, says the prospect of further changes to economic and trade policies in the U.S. means some Canadian firms will need to look for ways to mitigate added costs and take advantage of potential trade relief provisions to remain competitive.

Both presidential candidates have campaigned on protectionist policies that could cause uncertainty for Canadian trade, and whoever takes the White House will be in charge during the review of the United States-Mexico-Canada Agreement in 2026.

This report by The Canadian Press was first published Oct. 22, 2024.

The Canadian Press. All rights reserved.

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