News articles of '2018' 'August'

GOLD MINING shares rose as the broader stock market rallied Tuesday while the rise in US bond yields paused with 10-year rates just shy of 3%.

Gold bullion prices bounced $5 per ounce from yesterday’s 2-week low, touching $1328 as London opened for business.

That left gold little changed around last Friday’s finish in non-US currency terms as the Dollar joined bond yields and paused its rise of the last week on the FX market.

Silver and platinum kept all of Monday’s 2.7% and 1.0% drops respectively, trading back at $16.65 and $918 per ounce.

Palladium also failed to bounce after sinking over 6% yesterday amid reports that Washington may ease US sanctions over the metal against its No.1 miner, Russia.

The FTSE Gold Mines index meantime edged higher after the world’s largest stockmarket-listed gold miner reported a 5% rise in first-quarter earnings despite a 20% drop in gold ounces mined.

Announcing suspension of a “prefeasibility study” on the Andes mountain project at Pascua-Lama – expected to produce 125 tonnes over its first 5 years but shut since 2013 by environmental orders from the government of Chile – Barrick said its all-in sustaining costs rose 4.1% in January-March from the same period of 2017 to reach $804 per ounce.

Bullion market prices rose 9.0% year-on-year in Q1 to average $1329.

Barrick’s full-year guidance remains for maximum output of 155 tonnes in 2018, a further 6% drop after 2017’s fall of 4%.

Barrick’s output has now shrunk “nearly 40% since its peak of 2006,” according to Reuters, having sold a raft of assets to raise money in 2014-17.

Total debt has meantime halved to $6.4 billion from the peak of 2012-2013, and “Barrick does not intend to sell further assets for the purposes of debt repayment,” the company said Monday.

“Proceeds from any future portfolio optimization will be used to enhance our project pipeline, or returned to shareholders.”

At the top of gold’s bull run in 2012, ABX paid a dividend of 75 cents per share, offering a yield of some 1.6% to that year’s opening price.

Last year it paid 12 cents per share, a yield on 2017’s opening price of 0.5%.

Barrick’s stock fell 1.8% on Monday, dropping to 1-week lows.

First quarter results are due from No.4 gold miner Goldcorp (NYSE:GG) on Wednesday, No.2 Newmont (NYSE:NEM) on Thursday, and No.3 Anglogold Ashanti (JSE:ANG) in early May.

Data from the world’s largest gold producer nation China last week said its mining output fell 3% in Q1 after falling 6% across 2017 as a whole.

GOLD PRICES held in a tight $5 range around $1213 per ounce Tuesday morning in London, moving sideways against a weaker US Dollar as commodities edged higher and Donald Trump issued a warning to other countries over doing trade with Iran – now back under US sanctions over its nuclear research program.

With gold prices barely $10 above last week’s 12-month lows, world stock markets followed Wall Street higher, adding over 2.9% to China’s main equity index as the Yuan extended its rally versus the Dollar on the currency market.

The UK gold price in Pounds per ounce meantime ticked a 2-week high just below £938 as Sterling fell after both the National Farmers Union and the Association of Police & Crime Commissioners warned against a “no deal” Brexit – now 60/40 likely according to trade minister Liam Fox, “uncomfortably high” odds according to Bank of England chief Mark Carney.

Trump’s warning to other countries over the re-applied US sanctions was met by what the White House called “propaganda” from Tehran, where Iranian President Hassan Rouhani said “I don’t have preconditions [for talks]. If the US government is willing, let’s start right now.”

The Iran sanctions have officially been cast. These are the most biting sanctions ever imposed, and in November they ratchet up to yet another level. Anyone doing business with Iran will NOT be doing business with the United States. I am asking for WORLD PEACE, nothing less!

— Donald J. Trump (@realDonaldTrump) August 7, 2018

Despite the rise in trade and geopolitical tensions, investment in gold-backed trust funds shrank by 1.6% in July new data showed today, pulling their value down to $94 billion, the lowest in 12 months.

“Gold price performance was a large contributor to [those ETF] outflows,” says the mining-backed World Gold Council, posting the figures as a PDF, “as it fell over 2% in US Dollar terms.”

Private investors, in contrast, grew their physical bullion holdings at the fastest pace since December according to data from BullionVault this morning, with major coin fabricators also reporting a sharp rebound in business during July’s price drop.

The largest gold-backed ETF, the giant SPDR Gold Shares (NYSEArca:GLD), yesterday shrank again, reduced by 0.8% as investors sold once again.

That took the amount of gold needed to back the GLD’s value down to a new 12-month low at 788 tonnes.

The GLD peaked in size with 1,353 tonnes at end-2012.

Silver’s largest ETF product has also bucked the trend in gold-backed trust funds, with the iShares Silver Trust (NYSEArca:SLV) ending Monday at its largest size in almost a year to need 10,274 tonnes of bullion.

Silver outperformed gold prices in London on Tuesday, edging above last week’s finish to trade at $15.46 per ounce.

Platinum prices also recovered Monday’s drop, adding 1.9% to near last week’s peak around $840.

The Chinese Yuan meantime extended its rally from Friday’s new 15-month low, adding 1.0% versus the Dollar on the forex market.

Shanghai prices held unchanged in Yuan terms, showing a premium to London quotes of $4 per ounce – less than half the typical incentive for new bullion imports into the No.1 consumer market.

Disclaimer

This publication is for education purposes only and should not be considered either general of personal advice. It does not consider any particular person’s investment objectives, financial situation or needs. Accordingly, no recommendation (expressed or implied) or other information contained in this report should be acted upon without the appropriateness of that information having regard to those factors. You should assess whether or not the information contained herein is appropriate to your individual financial circumstances and goals before making an investment decision, or seek the help the of a licensed financial adviser. Performance is historical, performance may vary, past performance is not necessarily indicative of future performance. This report was produced in conjunction with ABC Bullion NSW.