Gold ETFs And Silver ETFs Drop On Europe Vote (GLD, IAU, SGOL, SLV, SIVR)
Gold ETFs and Silver ETFs dropped slightly today as 25 European nations approved new rescue fund
Gold ETFs and Silver ETFs dropped slightly today as 25 out of 27 European Union nations voted in approval of the new European Stability Mechanism rescue fund, which will replace and expand the current European Financial Stability Fund.
Gold and silver prices reacted negatively to the news as the gold spot price declined .13% today to close at $1730.00 per ounce, while the silver spot price declined 1.14% today to close at $33.51 per ounce. Gold ETFs including the SPDR Gold Trust ETF (NYSEARCA:GLD), the iShares Gold Trust ETF (NSYEARCA:IAU), and the ETFS Gold Trust ETF (NYSEARCA:SGOL) all declined more than half a percent today, while Silver ETFs including the iShares Silver Trust ETF (NYSEARCA:SLV) and the ETFS Silver Trust ETF (NYSEARCA:SIVR) dropped more than one percent today.
The decline in gold and silver prices and gold and silver ETFs is likely because of the European Union’s vote to implement a new rescue fund. Gold and silver are typically viewed as “safe haven” currencies when US Dollars or Euro Dollars appear to be jeopardized. The European Union has taken further steps today to ease its sovereign debt crisis and thus try to save the Euro dollar from collapse which likely improved confidence in the Euro and decreased needs for gold and silver. Europe is not out of the woods yet however (will it ever be?), as Portugal’s bond yields have spiked to 15.2% and Greece debt restructuring talks have stalled yet again. As such, gold and silver prices will likely rise again as fear of Euro dollar collapse returns.
Gold ETF Summary:
- SPDR Gold Trust ETF (NYSEARCA:GLD): -0.94 (-0.56%)
- iShares Gold Trust ETF (NSYEARCA:IAU): -0.09 (-0.53%)
- ETFS Gold Trust ETF (NYSEARCA:SGOL): -0.97 (-0.56%)
Silver ETF Summary:
- iShares Silver Trust ETF (NYSEARCA:SLV): -0.43 (-1.30%)
- ETFS Silver Trust ETF (NYSEARCA:SIVR): -0.44 (-1.31%)
Bottom Line: Gold and Silver prices and gold and silver ETFs likely declined today because greater confidence in the Euro dollar in light of Union’s vote to approve a rescue fund. Typically gold and silver are seen as “safe haven” currencies when US Dollars or Euro Dollars are in jeopardy, however today’s EU vote suggests that the Europe is moving forward to save its union and currency. In light of soaring Portugese bond yields and stalled Greek debt talks, it seems that the EU is under incredible duress and that gold and silver might rise again soon.
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Disclaimer: Wall Street Sector Selector trades a wide variety of ETFs and positions can change at any time.
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