Miners Surge; Gold, Silver Heading Higher at Week’s End

by Andrew Burger | January 27, 2012 11:53 am

Gold and silver were trading higher Friday morning amid a disappointing fourth-quarter U.S. GDP report, strong auction bidding for Italy’s six-month treasury bills and reported progress on Greece’s negotiations with private-sector holders of its government bonds.

Spot gold was nearly 0.5% higher Friday morning, bid at $1,729 per ounce with an ask price of $1,730. Spot gold traded as high as $1,730 and as low as $1,716.70. The London afternoon reference price fix came in at $1,726, unchanged from Thursday’s reference price, according to Kitco market data[1].

Spot silver was showing a gain of about 1%, bid at $33.79 per ounce with an ask price of $33.89. The morning high as of time of writing was $34.03 and the low was $33.22. Friday’s reference price was set at $33.48 in the London a.m., 13 cents per ounce above Thursday’s reference price.

The Commerce Department’s Bureau of Economic Analysis reported that its advance estimate of 4Q US Real Gross Domestic Product[2] came in at 2.8%, below consensus expectations around 3.2%. Positive contributions from private sector inventory investment, personal consumption expenditures, exports and residential and non-residential fixed investment were partially offset by reductions in federal, state and local government spending, while imports, which subtract from GDP, rose.

Strong bidding continued to push gold bullion in London on Friday morning, setting up for the largest weekly gain since early December, according to BullionVault’s London Gold Market [3]report.

“The market attitude towards gold for most of January could be summed up in two words: cautious optimism,” UBS commented in its latest precious metals note.

Gold markets in China, Singapore, Malaysia and Indonesia are scheduled to reopen Monday, adding liquidity to the market and affording participants a better read on investment flows, sentiment and demand and supply.

Turning to U.S. exchange trading, gold and silver trusts were moving up.

• The SPDR Gold Trust (NYSE:GLD[4]) was moving higher, up 0.75%.
• The iShares Gold Trust (NYSE:IAU[5]) was showing gains of more than 0.7%.
• The iShares Silver Trust (NYSE:SLV[6]) was moving higher, up nearly 1.7%.

Gold and silver mining ETFs were showing healthy gains.

• The Market Vectors Gold Miners ETF (NYSE:GDX[7]) was up around 1.7%.
• The Market Vectors Junior Gold Miners ETF (NYSE:GDXJ[8]) was up nearly 1.3%.
• The Global X Silver Miners ETF (NYSE:SIL[9]) was up just shy of 1%.

Gold mining shares were were surging higher for a second consecutive morning, with NovaGold Resources (AMEX:NG[10]) and Eldorado Gold (NYSE:EGO[11]

) leading the march higher.

• Agnico-Eagle Mines (NYSE:AEM[12]) was showing gains approaching 3.4%.
• Barrick Gold (NYSE:ABX[13]) was up 1.9%.
• Eldorado Gold was spiking higher, up between 4.5% and more than 5%.
• Goldcorp (NYSE:GG[14]) was some 1.6% higher.
• Kinross Gold (NYSE:KGC[15]) was showing gains of 1.4%.
• Newmont Mining (NYSE:NEM[16]) was up around 1.35%.
• NovaGold Resources was up sharply, showing gains of around 5.2%.
• Yamana Gold (NYSE:AUY[17]) was trading up about 3.4%.

Silver mining shares were sharply higher as well, with Hecla Mining (NYSE:HL[18]) and Silver Standard Resources (NASDAQ:SSRI[19]) showing the way.

• Coeur d’Alene Mines (NYSE:CDE[20]) was moving higher, up more than 2.7%.
• Hecla Mining was more than 3.1% higher.
• Pan American Silver (NASDAQ:PAAS[21]) was up around 2.3%.
• Silver Wheaton (NYSE:SLW[22]) was showing gains of 2.8%.
• Silver Standard Resources was up around 3%.

As of this writing, Andrew Burger did not hold a position in any of the aforementioned securities. Adrian Ash of BullionVault [23]contributed to this report.

Source URL: https://investorplace.com/2012/01/mining-stocks-surge-gold-silver-prices-gld-precious-metals/

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