Morning Silver Market Report

Compiled 06/15/11 6:00 AM ( CT ) Statistics: London Gold Fix $1,517.72 -$2.25 LME Copper Stocks 472,625 tons -1,050 tons SILVER MARKET FUNDAMENTALS: (6:00 AM CT) Silver starts the Wednesday US trade a touch below the prior session's close, but the market did make a temporary run above yesterday's high in the overnight trade. While the Press hasn't made much of deal out of news that exchange stocks of silver fell below the 100 million ounce level, that story could become a key focal point. In fact, Comex Silver Stocks were pegged at only 98.8 million ounces, for a rather noted single day decline of 1,999,340 ounces. Comex Silver Stocks are now at the lowest levels since 08/01/2006 and silver stocks have now declined in 12 of the last 20 days. News that a silver derivative saw a drop in holdings yesterday might partially countervail the downside breakout in silver exchange stocks, but it is also possible that investors are starting to see silver futures to be undervalued relative to other silver instruments. Silver did seem to bounce on the revelation that the US economy wasn't as slow as was feared, but some traders think that silver and other physical commodity markets need a better economic outlook to fully throw off the choppy to weak action on the charts seen over the last three weeks. Therefore, silver is likely to react to the scheduled US data flow this morning, but the overall change in the US numbers isn't expected to be that significant. OUTSIDE MARKET DEVELOPMENTS: (6:00 AM CT) While equity markets in Asia were mixed during the overnight session, stock indices in Europe are generally weaker this morning. Early indications are that US equity markets would open with moderate losses later on today. The US Dollar is sharply higher against most of the major currencies this morning. Workers in Greece have begun a nationwide strike to protest upcoming austerity measures for their nation. A major credit ratings agency has warned of a potential downgrade for several large French banks due to their exposure to Greek sovereign debt. French CPI during May was up 2.2% year-on-year, lower than market expectations. UK Unemployment during April was 7.7%, in-line with forecasts. Euro zone Industrial Production during April was up 0.2%, higher than expected. Major US economic numbers to be released this morning include the May Consumer Price Index and the NY Fed's June Empire State manufacturing survey for at 7:30 AM, May Industrial Production and Capacity Utilization at 8:15 AM, and a private survey of the US Housing Market at 9:00 AM.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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