LIVE Gold Prices $  | E-Mail Subscriptions | Update GoldSeek | GoldSeek Radio 

Commentary : Gold Review : Markets : News Wire : Quotes : Silver : Stocks - Main Page 

 GoldSeek.com >> News >> Story  Disclaimer 
 
Latest Headlines

GoldSeek.com to Launch New Website
By: GoldSeek.com

Is Gold Price Action Warning Of Imminent Monetary Collapse Part 2?
By: Hubert Moolman

Gold and Silver Are Just Getting Started
By: Frank Holmes, US Funds

Silver Makes High Wave Candle at Target – Here’s What to Expect…
By: Clive Maund

Gold Blows Through Upside Resistance - The Chase Is On
By: Avi Gilburt

U.S. Mint To Reduce Gold & Silver Eagle Production Over The Next 12-18 Months
By: Steve St. Angelo, SRSrocco Report

Gold's sharp rise throws Financial Times into an erroneous sulk
By: Chris Powell, GATA

Precious Metals Update Video: Gold's unusual strength
By: Ira Epstein

Asian Metals Market Update: July-29-2020
By: Chintan Karnani, Insignia Consultants

Gold's rise is a 'mystery' because journalism always fails to pursue it
By: Chris Powell, GATA

 
Search

GoldSeek Web

 
Gold Rallies But "Very Oversold" Miners Extend Losses Post-Bernanke



-- Posted Thursday, 18 July 2013 | | Disqus

BullionVault

London Gold Market Report

From Adrian Ash

 

WHOLESALE GOLD traded in a tight range around $1280 per ounce Thursday morning after recovering over a third of yesterday's $30 drop from 4-week highs.

 

Gold miner equities, in contrast, extended their fall as broader stock markets rose.

 

By lunchtime in London, African Barrick, spun out of the world's largest gold producer in 2010, stood 2.2% lower but held above last month's record low.

 

Russian miner Petropavlovsk lost a further 5%, taking its 2013 drop to more than 75%.

 

Like the gold bullion price, silver prices were quiet after Wednesday's sharp 4.3% swing, in line with other commodities.

 

US Treasury bonds ticked higher, nudging 10-year yields down to 2.48%.

 

"The sentiment [in gold stocks] is terrible – worse even than the sentiment towards gold," says HSBC analyst Patrick Chidley to the Financial Times.

 

"We have seen a 50% fall in gold mining shares in six months," the paper also quotes Evy Hambro, co-manager of the $2 billion Blackrock Gold & General Fund.

 

"Common sense would naturally say we are in very oversold territory."

 

Gold-heavy hedge fund manager John Paulson – whose $2 billion position in AngloGold Ashanti alone lost clients $317 million in the second quarter, according to the Wall Street Journal – yesterday defended his continued investment in both gold and gold producers.

 

"People who bought gold in anticipation of inflation have lost their patience," Paulson told CNBC's Delivering Alpha conference.

 

"[But] the consequence of printing money over time will be inflation, it's just difficult to predict when."

 

That makes gold "an important part of anyone's portfolio."

 

US Fed chairman Ben Bernanke restated his aim of starting to taper quantitative easing in testimony to Congress on Wednesday.

 

But on short-term rates – now at zero for more than four years – "I don't think the Fed can get interest rates up very much," he said, "because the economy is weak, inflation rates are low.

 

"If we were to tighten policy, the economy would tank."

 

Bernanke was due to resume his semi-annual testimony at 10am Thursday in Washington.

 

"The $30 pullback in gold prices [after Bernanke spoke Weds] was likely more a reflection of disappointment that prices did not manage to break resistance [at] $1300," says Swiss investment and London bullion bank UBS's strategist Joni Teves.

 

"Our economists," says a note from Commerzbank's commodity team, "are still confident that the Fed’s bond purchasing programme will be gradually scaled back from December. 

 

"This is likely to be largely priced in and should thus no longer weigh significantly on the gold price."

 

But "shifting sentiment regarding the timing of Fed tapering will impact gold and make trading volatile," warns HSBC analyst James Steel.

 

"Since investment demand is weak, with ongoing gold ETF liquidation, a strong physical market is crucial if gold prices are not to sink considerably further."

 

Further ahead, gold-mine output is set to shrink in the years to come, said Gold Fields' boss Nick Holland in an interview Wednesday, thanks both to the falling gold price and "a dearth of exploration projects.

 

"The industry is struggling to replace what it mined," says Holland, CEO of the world's 8th largest producer.

 

Adrian Ash

 

Adrian Ash is head of research at BullionVault, the secure, low-cost gold and silver market for private investors online, where you can buy gold and silver in Zurich, Switzerland for just 0.5% commission.

 

(c) BullionVault 2013

 

Please Note: This article is to inform your thinking, not lead it. Only you can decide the best place for your money, and any decision you make will put your money at risk. Information or data included here may have already been overtaken by events – and must be verified elsewhere – should you choose to act on it.


-- Posted Thursday, 18 July 2013 | Digg This Article | Source: GoldSeek.com

comments powered by Disqus



 



Increase Text SizeDecrease Text SizeE-mail Link of Current PagePrinter Friendly PageReturn to GoldSeek.com

 news.goldseek.com >> Story

E-mail Page  | Print  | Disclaimer 


© 1995 - 2019



GoldSeek.com Supports Kiva.org

© GoldSeek.com, Gold Seek LLC

The content on this site is protected by U.S. and international copyright laws and is the property of GoldSeek.com and/or the providers of the content under license. By "content" we mean any information, mode of expression, or other materials and services found on GoldSeek.com. This includes editorials, news, our writings, graphics, and any and all other features found on the site. Please contact us for any further information.

Live GoldSeek Visitor Map | Disclaimer


Map

The views contained here may not represent the views of GoldSeek.com, Gold Seek LLC, its affiliates or advertisers. GoldSeek.com, Gold Seek LLC makes no representation, warranty or guarantee as to the accuracy or completeness of the information (including news, editorials, prices, statistics, analyses and the like) provided through its service. Any copying, reproduction and/or redistribution of any of the documents, data, content or materials contained on or within this website, without the express written consent of GoldSeek.com, Gold Seek LLC, is strictly prohibited. In no event shall GoldSeek.com, Gold Seek LLC or its affiliates be liable to any person for any decision made or action taken in reliance upon the information provided herein.