Precious Metals Struggle as Government Nears Shutdown
On Monday, gold (NYSEARCA:GLD) futures for December — the most active contract — fell $12.20 to close at $1,327 per ounce, while silver (NYSEARCA:SLV) futures edged 12 cents lower to finish at $21.71.
Both precious metals experienced weakness despite the federal government moving closer to a shutdown due to budget negotiations. The Senate voted 54-46 to remove language from a House funding bill that delayed Obamacare by one year. Instead, Senate Democrats urged House Republicans to pass a clean bill to keep the government funded past Monday.
If Congress fails to reach an agreement, it would be the first government shutdown since 1996. Thousands of federal workers would be furloughed without pay and numerous government offices and programs would be closed. Functions deemed essential, like national security, would be remain open.
The Hill reports: “The afternoon vote leaves Congress where it was at the start of the weekend, with Senate Democrats insisting on passage of a stopgap free of policy riders and House Republicans demanding action on the Affordable Care Act. The government will shut down at midnight unless negotiators reach a compromise.”
By the end of the trading day Monday, shares of the SPDR Gold Trust (NYSEARCA:GLD) declined 0.6 percent, while the iShares Silver Trust (NYSEARCA:SLV) closed 0.3 percent in the red. However, gold miners (NYSEARCA:GDX) Barrick Gold (NYSE:ABX) and Yamana Gold (NYSE:AUY) both edged slightly higher. Shares of Endeavour Silver (NYSE:EXK) sank nearly 3 percent.
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Disclosure: Long EXK, AG, HL, PHYS