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Gold price dip has knock-on effect on mining stock values

Photo credit: Michelllaurence. Edited with TVScanline

The gold price has slumped after a dollar rally. On Thursday, the dollar, as measured by ICE U.S. Dollar Index, was trading 0.2% higher at 102 after touching its highest level in about two months, while the gold price for April delivery fell $17.10, or 1.4%, to settle at $1,232.90, according to Marketwatch.

Mihir Kapadia, CEO and founder of Sun Global Investments, a London-based financial services firm, was quoted by Marketwatch as saying ‘The combined factors of Donald Trump’s positive address in the Congress and the Fed-led dollar momentum has given a two-part blow to the commodity.’

This had an adverse effect on mining stocks, with the Market Vectors Gold Miners ETF, which holds stock in the world’s top gold miners, dipping 4%.

Business Vancouver reported that the Eldorado Gold Corp (TSX:ELD) was among the hardest hit, along with Canadian miners Yamana Gold (TSX:YRI) and Iamgold Corp (NYSE:IAG). All three lost more than 6% in value yesterday, pushing the stocks into negative territory for the year.

The world’s biggest mining company, Barrick Gold Corp (TSX:ABX) lost 4.6% with 32 million shares changing hands, the sixth most active stock on the NYSE. It is now worth $21.5bn, still an overall increase of 14% this year.

The second largest miner, Newmont Mining Corp (NYSE:NEM) only lost 2.4%, but ended up closing below the opening level for the year. This is in contrast to the higher production rates that Newmont is experiencing, nearing the 5 million ounce mark.

AngloGold Ashanti (NYSE:AU), the third largest, dropped 4.9% on Thursday trade, and had an 8% decrease to overall production last year. This was related to safety concerns.

In other news, following on from reaching an all time high, the cryptocurrency bitcoin has surpassed the value of a troy ounce of gold for the first time.

BBC news reported that It closed at $1,268 on Thursday while a troy ounce of gold stood at $1,233, and that the current high is being attributed to surging demand in China, where authorities say it is used to channel money out of the country.

Link to this article: : http://www.goldmadesimplenews.com/mining/gold-price-dip-has-knock-on-effect-on-mining-stock-values-13007/

Posted by on Mar 3 2017. Filed under Gold News, Mining. You can follow any responses to this entry through the RSS 2.0. You can skip to the end and leave a response. Pinging is currently not allowed.

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