Some gold bugs might be left saying to themselves "What else is new?" Following another day of being held hostage by global macroeconomic headwinds, gold futures fell. Comex gold for June delivery fell $10.20, or 0.6%, to close at $1,632.60 a troy ounce. More fears regarding the sovereign debt situation in Europe plagued the euro and sent traders running to most reliable safe have they know of these day: The U.S. dollar, not gold. The result was a decent day for the PowerShares DB US Dollar Index Bullish (NYSE: UUP).
Not all of the woes faced by the metals complex on Monday can be blamed on Europe. Preliminary manufacturing activity in China for this month indicates another month of contraction for the world’s second-largest economy. That would be the sixth consecutive month of lower manufacturing data. Since China is the world’s second-largest gold consumer, this news helped gold finish the day on a down, but industrial metals were also slammed on the news.
Industrial metals saw sharper declines than gold Monday on weaker demand expectations after the release of European economic data and news of a continued manufacturing slowdown in key raw materials consumer China, according to the Wall Street Journal.
Silver plunged, no surprise as industrial demand accounts for half of overall silver demand. The iShares Silver Trust (NYSE: SLV) lost 2.54% on below average to close at its lowest level since January. Looking at SLV’s chart, there’s really nothing in the way of material support to prevent the ETF from falling to $25-$26 in the medium-term.
The confluence of glum global economic concerns sent copper to a lower finish as well with the iPath DJ-UBS Copper TR Sub-Index ETN (NYSE: JJC) sliding 1.36%. The Global X Copper Miners ETF (NYSE: COPX) lost 3.23% on thin volume and has a purely awful chart at the moment. Shares of Freeport-McMoRan lost (NYSE: FCX) 1.1% on above average turnover.
The other white metals were no prizes either as the ETFS Physical Platinum Shares (NYSE: PPLT) declined 1.34% on light volume. The ETFS Physical Platinum Shares (NYSE: PALL) didn’t look too shabby by comparison with a loss of "just" half a percent. PALL’s chart looks still looks decent.
The same cannot be said of the mining ETFs. The Global X Silver Miners ETF (NYSE: SIL) lost 2.6% on strong volume and appears destined to retest support at $20. The Market Vectors Junior Gold Miners ETF (NYSE: GDXJ) also lost 2.6% while the Market Vectors Gold Miners ETF (NYSE: GDX) lost 2.3% on volume that was about 50% above normal. GDX touched another 52-week low today.