This Day On The Street
Continue to site right-arrow
ADVERTISEMENT
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
TheStreet Open House

Gold Prices Slip on Obama's Mixed 'Fiscal Cliff' Message (Update 1)

Stocks in this article: EGO RGLD AUY ABX GLD IAU

Updated from 11:45 a.m. EST with settlement prices and comments from President Obama

NEW YORK ( TheStreet) -- Gold prices dipped Wednesday as traders, who had been searching for some bargains after the prior session's selloff, sold their positions on Barack Obama's mixed message on fiscal cliff talks. The yellow metal lost more than 1.5% on Tuesday.

Gold for February delivery lost $3 to settle at $1,667.70 an ounce at the Comex division of the New York Mercantile Exchange. The gold price traded as high as $1,677.80 and as low as $1,665.10 an ounce, while the spot price was losing $2.90, according to Kitco's gold index.

"Each new fiscal cliff headline from Washington raises or lowers gold prices. The market looks heavy and technically weak for now," George Gero, precious metals strategist at RBC Wealth Management, wrote in a note Wednesday afternoon.

Obama said Wednesday that he was optimistic a deal would get done, but he rejected House Speaker John Boehner's "Plan B" budget proposal. That rejection suggested to some investors that an agreement would not immediately be reached.

Gold prices plummeted on Tuesday shortly after White House Press Secretary Jay Carney said that the president had rejected Boehner's proposal.

"Plan B" would include raising rates on those earning $1 million or more, implementing $1 trillion in spending cuts and locking in a process for tax and entitlement reform in 2013.

Boehner said Tuesday that he expected the House of Representatives to vote on the measure later this week.

The political-rhetoric game continued Wednesday morning as White House communications director Dan Pfeiffer said the administration wouldn't accept "Plan B" because it places too big of a burden on the middle class. Boehner spokesman Brendan Buck criticized the president's opposition as "bizarre" and "irrational."

Silver prices for March delivery shed 55 cents to $31.12 an ounce, while the U.S. dollar index was shedding 0.08% to $79.25.

Housing starts declined to a seasonally adjusted annual rate of 861,000 in November, according to the Census Bureau. Consensus among economists expected 873,000.

The lower-than-expected data could be seen by investors as weakness in the housing recovery. Though housing numbers have been on the upswing for months, traders would view a growing soft trend as negative to the economy but positive to gold prices as a continuation of central bank easing likely would result.

News from China was relatively quiet on Wednesday, a day after the country terminated a large soybean order. The move caused an initial slight drop in gold prices on Tuesday as some analysts said it indicated China may be trying to cool off its economy.

1 of 2

Check Out Our Best Services for Investors

Action Alerts PLUS

Jim Cramer and Stephanie Link reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

Jim Cramer's protégé, David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
Try it NOW
Try it NOW
Try it NOW

Check Out Our Best Services for Investors

Dividend Stock Advisor

Jim Cramer's protégé, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Options Profits

Our options trading pros provide over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • Actionable options commentary and news
  • Real-time trading community
Try it NOW
Try it NOW
Try it NOW
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!

Markets

DOW 17,416.85 +225.48 1.31%
S&P 500 2,021.25 +19.09 0.95%
NASDAQ 4,683.4070 +45.4130 0.98%

Partners Compare Online Brokers

Free Reports

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs