No Case of the Mondays for Gold & Silver

On Monday, gold (NYSE:GLD) futures for December delivery jumped $16.20 to settle at $1,652.30 per ounce, while silver (NYSE:SLV) futures climbed 41 cents to settle at $31.64.

Gold and silver added to gains from Friday, as the US dollar (NYSE:UUP) continues to decline.  The DXY Index fell to 76, as the euro gained on a report that Germany is willing to leverage Europe’s bailout fund to more than 1 trillion euros.  Furthermore, William Dudley, president of the NY Federal Reserve announced that QE3 is a possibility.  Dudley explained, “Clearly we’ve indicated our interest in supporting the housing market in keeping mortgage rate spreads, and spreads between mortgage rates and Treasury yields, from getting too elevated.  Depending on how the world evolves, we potentially could more to do more in that direction.”  This leads many, including myself, to believe that QE3 will focus on mortgage-backed-securities.

Investor Insight: Does Caterpillar Build A Bullish Scenario for Gold & Silver?

The markets rallied with the weaker dollar and strong earnings from Caterpillar (NYSE:CAT), a global construction and mining company.  The Dow (NYSE:DIA) jumped more than 100 points and precious metal equities surged.  Gold miners (AMEX:GDX) such as Barrick Gold (NYSE:ABX) and AngloGold (NYSE:AU) both climbed 4% higher in afternoon trading.  Silver miners (NYSE:SIL) such as First Majestic (NYSE:AG) and Endeavour Silver (NYSE:EXK) both surged 7%.

Fortuna Silver (NYSE:FSM) also climbed higher after the company reported a 42% increase in silver production for the third quarter.  Reuters reports, “Fortuna produced 673,137 ounces of silver in the quarter, while gold production more than doubled to 1,623 ounces.  The company said it is on track to produce 2.4 million ounces of silver and 7,530 ounces of gold this year.”

Special Feature: What’s Going On With Gold?

Shares of Freeport-McMoRan Copper & Gold (NYSE:FCX) are also off to the races as gold and copper (NYSE:JJC) prices rebound.  The world’s largest publicly traded copper miner also received positive attention from Barron’s over the weekend.  Barron’s said shares trade for “far less than the value of its mining assets.”  The article also called FCX a gleaming buying opportunity.  Shares are currently up nearly 9% before the close.

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