Silver ETFs Fall 6% on Week to 2011 Low
June 22nd 2012 at 2:51pm by John Spence
Silver prices tumbled below $27 an ounce this week as the Federal Reserve disappointed bullish traders who were looking for further quantitative easing.
Silver ETFs lost more than 6% on the week and are trading near the 2011 lows.
The bottom three unleveraged ETFs this week were iShares Silver Trust (NYSEArca: SLV), ETFS Physical Silver Shares (NYSEArca: SIVR) and U.S. Brent Oil (NYSEArca: BNO) with loses of about 6%.
Elsewhere in commodities, oil prices rebounded somewhat Friday after crude futures dipped below 78 a barrel. Gold fell below $1,600 on ounce this week.
U.S. equity ETFs reversed a two-week winning streak as stocks consolidated some recent gains after the S&P 500 pushed above its 50-day exponential moving average.
The market sold off Thursday, one day after the Federal Reserve extended its so-called Operation Twist program and said it stands ready ease further if the jobs market stumbles. The Fed announcement disappointed some investors who were looking for additional stimulus from the central bank.
The S&P 500 was set for a weekly decline of 0.7% in afternoon trading Friday, while the Dow shed 1% and the Nasdaq Composite gained 0.3%.
Investors remain fixated on Europe’s debt crisis although markets shrugged off Moody’s downgrading 15 of the world’s largest banks.
Despite the pullback in oil and precious metals, there were some standout performers in commodity ETFs this week, including corn, grains, agriculture and natural gas.
The top three unleveraged ETFs this week were Teucrium Corn (NYSEArca: CORN), iPath Grains (NYSEArca: JJG) and U.S Natural Gas (NYSEArca: UNG). There were on track for gains of at least 6% in afternoon dealings Friday.
In next week’s economic data, look for reports on home sales and prices, consumer confidence, durable goods orders, and personal spending and income.
iShares Silver Trust
Full disclosure: Tom Lydon’s clients own SLV.
The opinions and forecasts expressed herein are solely those of John Spence, and may not actually come to pass. Information on this site should not be used or construed as an offer to sell, a solicitation of an offer to buy, or a recommendation for any product.
