May 14th Market Report


As U.S. Recovers, Shortages Run Rampant

Gold prices hit $1,844.12 per ounce by 9:00 a.m. EDT. Gold and silver prices were mostly flat throughout the week but are ending the week on a strong note. Both metals declined modestly amid increasing inflation concerns and a tech sell-off that left the Nasdaq down by over 2.5% on Tuesday. So far, platinum has experienced the most significant price movement, shedding over 4.5% from levels on Monday near $1,276.00. In an attempt to minimize the weekly loss, platinum is on the rise today, and at the time of posting, neared $1,241.00.

A hack on the Colonial Pipeline, Co. deprived the East Coast region of 1.2 million barrels of gasoline per day. In the Southeast, North Carolina officials declared a state of emergency. Americans braced for the ramifications of the shortage as American leaders navigated next steps.

Meanwhile, stock futures, Treasuries, and the dollar declined. Commodities displayed mixed performance. As oil faltered, gold moved upward.

Early in the week, big names in technology asked Congress to bolster the CHIPS for America Act to offset the effects of the semiconductor computer chip shortage with a $50 million price tag. The plan would foster a more robust supply chain that would be poised to support availability of vital technologies. The ripple effect of the shortage has affected a myriad of industries reliant on the technology.

Midweek, gas prices moved to the highest level since 2014, hitting over $3 a gallon. The U.S. government made efforts late in the week to alleviate gasoline scarcity with eased environmental and import rules. Finally, Colonial Pipeline, Co. Restarted operations late in the week, providing hope for fuel reprieve.

Consumer prices rose 0.9% between March and April. Although increases were projected, analysts were surprised to see the significant jump, as it is the biggest since 2009. Gold has gained some positive traction amid a dollar pullback. The yellow precious metal was also supported by an announcement from the Fed that rates will remain unchanged until inflation levels are higher for more sustained periods of time.

Supporting factors for both metals are evident as the week comes to an end. Many investors do not see a near-term end to inflationary concerns. If this week was any indicator, gold and treasuries may continue to battle for the preferred asset as a hedge against inflation. Many continue to remain bullish on silver as well, as the metal is up by over 80% on the year. Silver demand continues from the industrial sector, and retail investors alike.

U.S. agricultural exports hit a snafu late in the week when a crack was found in a bridge over the Mississippi River. The compromise halted more than 700 barges of goods. A sustained outage could inhibit exports leaving the Gulf and ultimately damage the crop market.

Israeli-Palestinian conflict continues to escalate, raising concerns about international relations.

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