Gold Holds Steady as The Dow Falls Over 3%

On Wednesday, gold futures for December delivery declined $7.60 to settle at $1,791.60 per ounce, while silver futures fell 79 cents to settle at $34.36.  It was the first decline for gold in three sessions.

German and French officials are discussing plans for a radical overhaul of the European Union that would involve establishing a more integrated, but potentially more exclusive, euro zone.  Senior policy makers in Paris, Berlin, and Brussels have reportedly raised the possibility of one or more countries leaving the euro zone, according to EU sources, while the remaining core pushes for deeper economic integration.  One senior EU official said changing the make-up of the euro zone had been discussed on an “intellectual” level but no decision has yet been made, while a French government source denied any such project was in the works. Such steps would require the backing of EU countries, as their treaties would have to be adjusted.

Investor Insights: Here’ What Germany and China Really Think About Gold

With the Dow (NYSEARCA:DIA) falling more than 3% on Wednesday, gold held up as a safe-haven play.  The SPDR Gold Shares ETF (NYSEARCA:GLD) declined by only .40% in afternoon trading.  Barrick Gold (NYSE:ABX) declined by .50%, while Yamana Gold (NYSE:AUY) slipped 1.85%.  Silver did not hold up quite as well as gold.  The iShares Silver Trust (NYSEARCA:SLV) declined by 2.6% heading into the close.  Endeavour Silver (NYSE:EXK) fell 2.3%, while First Majestic Silver (NYSE:AG) fell nearly 5%.  First Majestic announced third quarter earnings of $27.8 million, which represents a whopping 176% increase from last year’s third quarter.  Mine operating earnings increased 168% to $42.5 million, while silver ounces produced decreased by 6% to 1,708,865.

International Monetary Fund Managing Director Christine Lagarde has warned that the global economy is at risk of being plunged into a “lost decade” unless nations act together to counter threats to growth.  “In our increasingly interconnected world, no country or region can go it alone,” Lagarde said in a speech to a forum in Beijing today. “Our sense is that if we do not act boldly and if we do not act together, the economy around the world runs the risk of downward spiral of uncertainty, financial instability and potential collapse of global demand,” she said. “We could run the risk of what some commentators are already calling the lost decade.”

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