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Gold continues to stick around the $1,400 level like a magnet…as of 7:30 am Pacific, bullion is down $1 an ounce at $1,402…tomorrow’s U.S. is up 4 cents to $22.59…non-farm payrolls report will be critical in determining if Gold can begin to gain some traction above $1,400 and post a strong weekly close…Silver is off 7 cents at $22.48…Copper has fallen from a 2-week high, down a nickel to $3.31…Crude Oil is up $1.28 to $95.02 while the U.S. Dollar Index has slid one-third of a point to 82.25…

According to a report from Reuters, the Reserve Bank of India has advised banks against selling Gold coins to retail customers, Finance Minister P. Chidambaram said this morning, a day after he raised the Gold import duty to try to ease pressure on India’s bloated current account deficit…”I think the Reserve Bank has advised banks that they should not sell Gold coins,” said Chidambaram, while speaking at an event in Mumbai…he also urged banks to advise their customers not to invest in Gold…Gold imports by India, the world’s biggest buyer of bullion, surged to 162 tonnes in May — more than twice the monthly average in the record year of 2011…when the state actually starts telling its citizens NOT to invest in Gold, chances are they might even be more inclined to do so…

The appetite for U.S. American Eagle Gold and Silver bullion coins is still at unprecedentedly high levels almost two months after a historic sell-off in Gold unleashed years of pent-up demand from retail investors, the head of the U.S. Mint said yesterday…his comments are likely to allay concerns among some traders that frenzied buying by mom-and-pop investors since mid-April – after prices plunged to two-year lows – had started to fade…”Demand right now is unprecedented..we are buying all the coin (blanks) they can make,” Richard Peterson, U.S. Mint’s acting director, said in an interview inside the Mint’s production facility in West Point, New York, referring to the Mint’s suppliers..sales of Gold and Silver bullion coins, including the popular 22-karat American Eagle and the 24-karat American Buffalo, are on pace to hit a record 45 million coins this year, said Peterson, head of the Treasury Department agency since 2011…the Mint sold about 35 million bullion coins in 2012 (source: Reuters, www.Mineweb.com)…

U.S. Jobless Claims Drop Slightly

The number of Americans filing new claims for unemployment benefits declined 11,000 last week to a seasonally adjusted 346,000, the Labor Department reported this morning, and this was generally in line with expectations…the drop is a positive sign that the labor market continues to steadily heal…however, claims data can fluctuate, and a broader measure of layoffs increased last week…the 4-week moving average, which smoothes out weekly volatility in the data, rose by 4,500 to 352,500…this morning’s figures offer a preview of tomorrow’s much broader look at the labor market, the Labor Department’s monthly employment report…economists forecast that payrolls grew by 169,000 in May with the unemployment rate holding steady at 7.5%…

China Has Growing Appetite For Food Imports

China is set to become more dependent on imported grains, oilseeds and meat during the next 10 years, a development that is likely to support prices and fuel further deal making in the global agribusiness industry…the Food and Agriculture Organization and the OECD today painted a bullish view for Chinese food demand in their closely watched annual agricultural outlook…the report for the first time devotes a full chapter to China…the country’s imports of coarse grains, used mostly for fattening herds, are expected to double by 202…imports of soyabeans will grow 40% while meat imports are set to soar – beef imports nearly doubling…

Today’s Markets – ECB & BOE Leaves Rates Unchanged

Asian markets were lower overnight with Japan’s Nikkei average falling another 111 points to 12904…the Index has now fallen 19% since hitting a 5.5-year peak of 15942 just over 2 weeks ago on May 22…China’s Shanghai Composite lost 29 points overnight to close at 2242…European shares are down slightly in late trading overseas…in a news conference this morning, ECB President Mario Draghi said the ECB is “technically ready” to lower the bank’s deposit rate into negative territory for the first time, which would mean the central bank would charge commercial banks for holding their money overnight, but ruled it out for the time being…the ECB left its main interest rate unchanged at a record low 0.50% and said the euro zone is on track for a “very gradual recovery” later this year driven by the central bank’s loose monetary policy and demand from abroad…”The Governing Council continues to see downside risks surrounding the economic outlook for the euro area,” Draghi added…”They include the possibility of weaker-than-expected domestic and global demand and slow or insufficient implementation of structural reforms in euro area countries“…
No surprises this morning from the Bank of England as it voted to keep benchmark interest rates unchanged at 0.5% at Mervyn King’s final monetary policy meeting as Governor…the BOE also opted to keep the size of its asset purchase program unchanged at 375 billion pounds ($574 billion)…Ex-Bank of Canada Governor Mark Carney will replace King on July 1 2013, and has agreed to serve for 5 years…

in North America, the Dow is up 4 points as of 7:30 am Pacific while the S&P 500 has gained a point to 1610…a measure of market movement known as the advance/decline line, which measures stocks rising and falling compared to previous values, shows that over a 10-day timeframe the S&P 500 is at “extreme oversold levels,” according to research from Bespoke Investment Group…while the near-term implications vary, the S&P 500 averages gains of 2.18% and 6.21% over the next 3 and 6 months respectively when it hits this level…one sign that investors are expecting more gyrations in stock markets is that the Volatility Index (VIX) has risen to the highest in more than 6 weeks, though it is still below the yearly high hit in February…meanwhile, a snap survey by CNBC yesterday of about 2 dozen economists, money managers and strategists showed that about 35% of them expect the Fed to start tapering its bond purchases in September…the next largest group, 23%, expect the Fed to taper in January…just a fraction, 3.8%, see tapering in July, while the same amount expects tapering in 2015 or later…

Updated Dow Chart

Don’t expect the Dow to collapse like the Nikkei…John’s 1.5-year weekly chart shows a very strong support band between 14500 and 14700…

As of 7:30 am Pacific, the TSX is down 5 points while the Venture is up 2 points at 949…the 970 area continues to provide strong resistance for the Venture, as we saw again Monday…the Index is now slightly below its 10 and 20-day moving averages…

Colorado Resources (CXO, TSX-V) Releases Results From Holes 2, 3 & 4

A typical “sell on news” mentality hit investors this morning as Colorado Resources (CXO, TSX-V) provided fresh drill results from its North ROK discovery at Iskut River…hole 2 was a dud, as expected (it may not have been drilled deep enough), but CXO delivered encouraging results from holes 3 and 4 which certainly compare favorably to Red Chris…NR-13-004, collared 100 metres southeast of the discovery hole, intersected 205.2 metres grading 0.40% Cu and 0.50 g/t Au, including 131 metres grading 0.56% Cu and 0.68 g/t Au…NR-13-003, meanwhile, which was drilled at the same location as the discovery hole but at a different angle and deeper, returned 152.4 metres grading 0.21% Cu and 0.55 g/t Au…as analysts pour over these results, and other details included in Colorado’s release this morning, we expect the consensus will be more favorable than the initial reaction from traders this morning…porphyry deposits are never easy to figure out but the big picture of what Colorado is putting together continues to be very promising…

North ROK clearly has the potential to be a large mineralized system…geophysical work has outlined a 1200 m x 1200 m chargeability feature open to the south which has only been tested on its northernmost end by the 3-hole drill program over a 100-metre area…a second 500 x 1000 metre chargeability feature has also been discovered 1 km to the north of the drill area…less than 5% of the area of these geophysical anomalies has been tested by drilling…

As stated in CXO’s release this morning, recently completed surface geological mapping indicates that the monzonite intrusion is 2000 metres x 2500 metres in size and is similar to the Red Stock which hosts the Red Chris Mine (mineable reserve of 301.5 mt of 0.359% copper and 0.274 g/t Au)…over much of this strike length, the North ROK intrusion has also been extensively altered by magnetite-potassium feldspar and quartz sericite pyrite mineral assemblages and appears similar to hydrothermal alteration assemblages spatially associated with Copper and Gold mineralization at the Red Chris mine…

Strong chart support exists in the upper ’60’s for CXO and John will be providing a chart update tomorrow morning…through the first hour of trading, CXO is off 53 cents at 70 cents…expect bargain hunters to step up to the plate because this story is still very much alive and well…

Global Met Coal Corp. Chart (GMZ, TSX-V)

Finally, at long last and at the urging of some of our readers, www.StockCharts.com has added Global Met Coal (GMZ, TSX-V) to its data base, so we’re able to provide a chart on this company for the first time…GMZ is in the final stages of the permitting process with the state of Alabama regarding its Black Creek metallurgical coal project which would be a turnkey operation that could generate significant cash flow for the company…management has previous successful experience with met coal operations…the second and final tranche of the company’s proposed $600,000 financing is expected to close in the coming days…a 20-month daily chart shows steady accumulation in the stock since March and the potential for a near-term breakout with strong support at a nickel the last several sessions…

Note: John and Jon both hold share positions in GMZ.  Jon holds a share position in CXO.