Friday, June 8, 2012

Gold Pare Losses, Oil Down 2% On Risk Aversion (USO, UNG, GLD, SLV, CHK, MPWR)

Commodities were trading lower with Crude oil slumped over 2% as investors preferred to stay away from the risky assets after the Federal Reserve’s failure to hint at further monetary stimulus buoyed the U.S. dollar.
Light, sweet crude-oil futures for July delivery slumped -2.23% to $82.96 a barrel on the New York Mercantile Exchange, trading around 0.2% lower for the week. Crude wasn’t the only product from the energy complex that came under intense selling pressure. The July futures for gasoline fell -1.61%  cents, or 1.5%, to $2.64 a gallon and July heating oil lost -0.89% to $2.65 a gallon.Natural-gas futures for delivery in the same month jumped +1.1 to $2.31 per million British thermal units.

Fitch Ratings downgraded Spain’s credit ratings by three notches to BBB from A, saying the country will likely need external financial support to battle its banking crisis. The BBB rating is two notches higher than junk status. But speculation of a rescue plan for Spain’s banks that could come as soon as the weekend, helped European stocks pare losses.

The dollar also jumped in Friday’s trade, adding further pressure to dollar-denominated commodities such as oil. The ICE dollar index climbed to 82.63 from 82.241 in North American trade Thursday.
Gold futures pared their losses Friday, briefly turning higher to track modest gains in the U.S. stock market as President Barack Obama spoke about the economy and the European debt crisis. Strength in the U.S. dollar after Federal Reserve Chairman Ben Bernanke failed to offer any hint of further monetary stimulus continued to put pressure on dollar-denominated gold prices.

Gold for August delivery fell -0.13% to $1,587.40 an ounce on the Comex division of the New York Mercantile Exchange after trading as low as $1,556.40. Prices were poised for a loss of around 2.1% for the week. Copper was the leading laggard as its July contract fell -2.15% to $3.31 a pound. July silver lost -0.47% to $28.46 an ounce. July platinum fell -1.08% to $1,421.30 an ounce, while September palladium sank $13.25, or 2.1%, to $612.50 an ounce.

United States Oil Fund LP (ETF)(NYSEARCA:USO) was down 0.49 (-1.54%) at $31.23, SPDR Gold Trust (ETF)(NYSEARCA:GLD) fell 0.79 (-0.51%) to $153.71, iShares Silver Trust (ETF)(NYSEARCA:SLV) lost 0.22 (-0.79%) to $27.57 and United States Natural Gas Fund, LP(NYSEARCA:UNG) jumped 0.09 (0.57%) to $15.90.
Chesapeake Energy Corporation(NYSE:CHK) moved up 0.56% as 63% of shareholders vote against incumbent directors V. Burns Hargis and Richard Davidson. 53% vote in favor of a resolution to reincorporate the company in Delaware, which would allow annual director elections.
Monolithic Power Systems, Inc.(NASDAQ:MPWR) jumped 7.17% after Stifel Nicolaus upped the shares to Buy this morning, citing the company's new product strategy, end market diversification, attractive financial model and solid free cash flow.

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