Oil, gold, silver are 'uncertainty magnets'
April 5th, 2011
06:12 PM ET

Oil, gold, silver are 'uncertainty magnets'

A roundup of today's business news headlines:

Stocks end flat after Fed minutes

U.S. stocks ended little changed Tuesday, as investors weighed hawkish meeting minutes from the Federal Reserve.

The Dow Jones industrial average fell 6 points, or less than 0.1%, to close at 12,394. The S&P 500 slipped less than 1 point to 1,332; the Nasdaq Composite edged up 2 points to 2,791.

Stocks were supported by gains in semiconductor companies after Texas Instruments announced a $6.5 billion bid for rival National Semiconductor. Shares of National Semiconductor surged 72%. But the market came under pressure after meeting minutes from the Federal Reserve raised speculation that the U.S. central bank could raise rates later this year amid rising inflation.

Oil, gold, silver are 'uncertainty magnets'

Geopolitical concerns have eroded confidence in paper money, leading investors to pile into commodities - which, in turn, have reached multi-year and all-time highs.

Tensions in the Middle East and Libya have not abated, and Japan is dealing with post-earthquake rebuilding and ongoing nuclear issues.

"We have major issues going on both abroad and at home, and commodities are great uncertainty magnets," said PFG Best senior market analyst Phil Flynn.

The appeal of stocks has been somewhat tarnished by the volatile global situation, and bond investors "have been kind of forced out by the Fed's low interest rates," Flynn said. Meanwhile, the physicality of commodities have boosted their appeal - and made prices soar.

Treasury prices dip

Treasury prices edged slightly lower and yields continued their recent climb higher, but investors kept an eye on continuing political unrest and global economic news Tuesday.

The market didn't react much to the minutes from the Federal Reserve's latest policy meeting released in the afternoon. Meanwhile the U.S. central bank continued with its systematic debt purchase program through the week.

The Treasury market has bounced around in a pretty narrow range for the last three months, as investors weigh signs of an economic recovery in the United States against a slew of crises across the globe.

Investors tend to dump bonds and buy more profitable assets, such as stocks, when the economy is on the upswing. But uncertainty sends them scurrying for the perceived safety of Uncle Sam's debt.

- CNNMoney.com reporters Catherine Clifford, Julianne Pepitone and Ben Rooney contributed to this report.

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Filed under: Economy
soundoff (16 Responses)
  1. drap

    Will they stick to my fridge... .?

    April 5, 2011 at 6:32 pm | Report abuse |
  2. banasy

    @drap: LMAO!!! I thought the same thing!

    April 5, 2011 at 6:37 pm | Report abuse |
  3. Dim Mak

    The main reason the government took all precious metal currency out of circulation was to prevent the common man any thing to bargain with should the paper money become useless. The rich always own commodities because they know they're actually worth something.

    April 5, 2011 at 6:55 pm | Report abuse |
  4. Charlton Heston

    When paper money becomes useless..IT'S SOYLENT GREEN!! EVERYBODY RUN!! SAVE YOURSELVES..D@MN YOU ALL..whoo just kidding just having an NRA moment.

    April 5, 2011 at 7:13 pm | Report abuse |
  5. mari

    So it shall be written, so it shall be done.

    April 5, 2011 at 7:44 pm | Report abuse |
  6. Satan

    @mari: Ummm I thought you were on my team? What happened? The unicorn dies tonight?

    April 5, 2011 at 8:03 pm | Report abuse |
  7. Joey

    Land is good.
    Own (start) the factory yourself.
    You can look at good paintings and they appreciate pretty quickly.
    Gems can be sewn into your clothes to cross borders should somebody make trouble.

    April 5, 2011 at 8:12 pm | Report abuse |
  8. chuns reef

    hey charlton,your blogging choices are your givaway.I'll be in S.C. in a two weeks,hows my new board?

    April 5, 2011 at 8:26 pm | Report abuse |
  9. banasy

    Uhhhhh, I don't think mari's a team player, Satan.

    April 5, 2011 at 8:44 pm | Report abuse |
  10. JAZZ

    I think Mari, has ISSUE'S

    April 5, 2011 at 8:48 pm | Report abuse |
  11. banasy

    Ya think, Jazz? 🙂

    April 5, 2011 at 9:35 pm | Report abuse |
  12. Dim Mak

    @banasy+JAZZ: She's gone. Shhh... If you say her name 10 times she will smash through your screen and sting you with bees before using her hook hand to disembowel you.

    April 5, 2011 at 9:48 pm | Report abuse |
  13. chris

    So it shall be written, so it shall be done.

    August 17, 2011 at 7:52 am | Report abuse |
  14. chris

    Ya think, Jazz?

    August 17, 2011 at 7:58 am | Report abuse |
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    April 24, 2012 at 1:01 pm | Report abuse |