Precious Metals

The Dow posted a 92 point rally last night as M&A shouldered aside subprime and Merck posted a good result.

One poor earnings result set off a jittery Wall Street as funds buying returned to gold and China hiked.

Wall Street has decided to like Mr Bernanke’s comments as earnings results again pleased, at least before the bell. Oil, gold and base metals were all strong.

Barclays Capital has reviewed the performance of commodity markets for the last quarter and concludes oil and base metals should go higher while gold looks like moving sideways.

The Dow recovered somewhat from an initial 134 point fall last night as bargain hunters offset inevitable Bear Stearns weakness and disappointment from Mr Bernanke.

Wall Street action was all after the bell this morning as Bear Stearns announced its funds at the centre of the subprime crisis were close to worthless and some poor profit results were posted.

Wednesday night’s CPI result in the US should provide a clue to the next move in gold as the US dollar threatens to truly collapse.

There was a broad market decline on Wall Street overnight leaving the Dow to do its own thing on rumours of a bid for telco Verizon.

Potential earnings per share of more than 2c in FY09 makes Perseverance cheap at current prices, but brokers are split over whether management can achieve its goals.

The Dow has posted one of its most extraordinary sessions ever rising 284 points largely on the back of retailer earnings reports.