Gold Sharply Lower Monday Despite Growing Euro Concerns

Gold prices might have wrong-footed a lot of market participants early Monday
as the spot gold price plunged about $40 per ounce, from $1,820 to just above
$1,775. Investors and traders would have justifiably expected heightened
safe-haven demand and a sharp run-up in prices after news that the European
Union and International Monetary Fund said Greece, already struggling to pay its
debts, would have to impose even stricter austerity measures for the EU and IMF
to release a second tranche of emergency funding next month. Instead, gold
prices moved sharply in the opposite direction. Spot gold was bid at $1,781 with
an ask price of $1,782 Monday morning, down 1.38%, having hit a high of $1,820
and a low of $1,775.30, according to Kitco market data . The London p.m. gold
fix price was set at $1,794 an ounce, according to the LBMA . Spot silver was
trading at $39.47 Bid, $39.57 Ask early Monday, down 2.93%, having hit a high of
$40.45 and a low of $39.11. The reference price for Sept. 19 was fixed at $40.46
in the London a.m. Looking at this weeks economic calendar, August housing
starts and building permits reports are out Tuesday, as is the closely watched
FOMC interest rate policy decision for September. August existing home sales and
crude inventories come out Wednesday. Thursday brings the weekly initial and
continuing jobless claims reports, August leading economic indicators and the
FHFA Housing Price Index. Turning to the exchanges, gold and silver trusts were
moving lower. The SPDR Gold Trust (NYSE: GLD ) was down almost 1.3%. The iShares
Gold Trust (NYSE: IAU ) was about 1.2% lower. The iShares Silver Trust (NYSE:
SLV ) was around 2.4% lower. Gold and silver mining ETFs were moving lower for a
sixth consecutive business morning. The Market Vectors Gold Miners ETF (NYSE:
GDX ) was around 0.3% lower. The Market Vector Junior Gold Miners ETF (NYSE:
GDXJ ) was down about 2.7%. The Global X Silver Miners ETF (NYSE: SIL ) was
around 1.5% lower. Shares of gold miners were broadly lower as well, though
Barrick Gold and Newmont Mining were trading higher. Agnico Eagle Mines (USA)
(NYSE: AEM ) was around 1.1% lower. Barrick Gold Corp. (NYSE: ABX ) was trading
higher by about 0.9%. Goldcorp (NYSE: GG ) was around 0.3% lower. Newmont Mining
Corp. (NYSE: NEM ) was up nearly 1.2%. NovaGold Resources (USA) (AMEX: NG ) was
sharply lower, down more than 3%. Silver mining shares were mixed in Friday
morning trading, with Silver Standard Resources showing strong gains. Coeur
DAlene Mines Corp. (NYSE: CDE ) was up between 0.35% and more than 0.5%. Hecla
Mining (NYSE: HL ) was down around 1.25%. Pan American Silver Corp. (USA)
(NASDAQ: PAAS ) was some 0.15% lower. Silver Wheaton Corp. (USA) (NYSE: SLW )
was showing gains of more than 1.5%. Silver Standard Resources Inc. (USA)
(NASDAQ: SSRI ) was up over 2%. The author does not hold positions in any of the
above-mentioned investments.