Precious metals witnessed mixed finish on Tuesday, 25 March 2014. Gold futures closed with a modest gain on Tuesday as declines in monthly U.S. home sales and prices drove some safe-haven demand for the metal, helping the metal edge up from a more than five-week low. But silver prices dropped.
Gold for April delivery rose 20 cents to settle at $1,311.40 an ounce on the Comex division of the New York Mercantile Exchange.
May silver shed nearly 9 cents, or 0.4%, to $19.98 an ounce.
In overnight news, the German Ifo business confidence index weakened in March, in part due to the crisis in Ukraine. The Ifo index came in at 110.7 in March versus 111.3 in February. Forecasts were for a reading of 108.0 in March.
The leaders of the world's largest economies (formerly called the G-8 and now called the G-7) moved on Tuesday to remove Russia out of the group. The action was not unexpected and had little market impact.
Traders are still buzzing about the downbeat manufacturing data from China on Monday, which continued a trend of weaker-than-expected economic data coming from the world's second-largest economy. There is now talk in the market place that China economic officials may soon act to invigorate their economy with monetary stimulus.
The metals markets got very little direction Tuesday from U.S. economic data that included the S&P/Case-Shiller home price index, the monthly house price index, new residential sales, the consumer confidence index, and the Richmond Fed business survey. The data was a mixed bag, regarding consensus forecasts.
In details, the January Housing Price Index from the FHFA increased 0.5%, which followed a revised uptick of 0.7% observed during the prior month. The Case-Shiller 20-city Home Price Index for January rose 13.2% while a 13.3% increase had been expected by the consensus. This followed the previous month's increase of 13.4%. Separately, New home sales declined 3.3% in February to 440,000 from a downwardly revised 455,000 (from 468,000) in January. The consensus expected sales to fall to 445,000.
The Conference Board's Consumer Confidence Index strengthened in March. The index increased to 82.3 from an upwardly revised 78.3 (from 78.1) in February. The consensus pegged the index at 78.2. The reading put confidence levels at the highest point since January 2008. Typically, confidence levels trend with unemployment, gasoline prices, and the equity market. The increase in volatility in the equity market over the past few weeks did nothing to harm confidence. Instead, consumers relied on more favorable employment conditions.