Boost in Barrick Gold Corporation (NYSE:ABX)’s gold brick
On Friday, Gold and silver miners traded at significantly higher levels even as gold rallied for two days. This rally manages to wring out a bit of a profit for the week and widened the distance from its 3-week plateau. A softening in the U.S Dollar eased some frowns of reduction in stimulus measures in September. Gold gained around $45/ounce after the lows that it stood at on Wednesday, last week. That was when the dollar hit 7-week lows.
A breath of fresh air
Some strong winds have been blowing in from China as well which brought in a whiff of economic optimism. There was news of a drop in South African mine output which added a little support. Gold prices rose above 1% on Monday, which has been its highest point in almost 2 weeks. This was primarily attributed to increase in holdings in the largest gold exchange traded fund in the world. This has been the first rise in 2 months.
In Monday’s trading session, ABX rose by 4.54%. The opening price of the shares was $18.10 which touched an intraday high of $18.44 and closed at $18.21. Almost 0.951M shares exchanged hands in Monday’s session. The average-volume of shares that were traded over a 30-day period was 19.01M. The company has a market cap of 18.23
Broadly speaking, the mining sector has been experiencing an extended spell of depression. Fed members and Fed watchers or the bears all swung out “sell” ratings for gold shares, but have they actually owned any gold themselves? The S&P 500 is up just 10% since 2007 October while gold is stands 75% higher in the same period of time.
Fact is that gold has a massive correction. At the moment the sentiment is very bearish and gold mining stocks like that of Barrick Gold Corporation (NYSE:ABX) have been destroyed. The gold mining industry as it stands today is in poorer shape than it was in the ultra-low 2008 market