Gold and Silver Decline on China Concerns
Metals such as copper and silver suffered a broad pullback as BHP Billiton (NYSE:BHP), the world’s biggest miner, voiced concerns about the possibility of a sharp slowdown in China, the world’s biggest metal consumer. The company’s president, Ian Ashby, said China’s iron-ore demand is easing and that growth is likely to slow to single digits.
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“There is a variety of things affecting prices today including ongoing concerns about Chinese demand and worries about higher oil prices, which are not good for growth prospects,” explained Natixis head of research Nic Brown. “As the Chinese economy matures you would expect it to move from a heavy industrial model towards a services model, and this would reduce raw materials demand, but for me this is still a long way off.”
In afternoon trading, the SPDR Gold Trust (NYSEARCA:GLD) declined 1 percent, while the iShares Silver Trust (NYSEARCA:SLV) dropped 3 percent. Gold miners (NYSEARCA:GDX) such as Goldcorp Inc. (NYSE:GG) and Barrick Gold (NYSE:ABX) edged about .15 percent lower, while Yamana Gold (NYSE:AUY) jumped 1.25 percent. Silver Wheaton Corp. (NYSE:SLW) was one of the largest decliners in the silver space, falling more than 2 percent. Meanwhile, Silvercorp Metals (NYSE:SVM) and Hecla Mining (NYSE:HL) fell about 1 percent.
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