AP: Gold steady above $1,220 as UK house prices decline, US data eyed
Precious metals rose today with gold getting enough support to stay above the US$1,220/oz level after UK house prices were reported to have declined for the second month in a row. Rightmove (LON:RMV) today said that the average price declined 1.7% to £2232,000 in July after sliding 0.6% in the previous month in yet the latest sign that the economic recovery is slowing.
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New funding speeds Kryso Resources towards production at Pakrut Gold ProjectPan African H1 revenues up 16.5%, profit held back by successful security push at Barberton MinesOrosur Mining looks to Chile and Arenal DeepsGold was on the rise last week as investors were again pouring money into safe haven assets after US economic data and statements from the Federal Reserve and the Bank of England raised concerns about the strength of the ongoing recovery. BoE governor Mervyn King said the recovery would be “choppy,” while the Fed said it would start buying US bonds to bolster the economy. Both left their respective interest rates unchanged at the current ultralow levels.
The mood in the markets improved late in the week after the first reading of the University of Michigan consumer sentiment index showed an improvement to 69.6 in August from July’s 67.8.
Investment bank Goldman Sachs (NYSE:GS), which projected gold to reach US$1,300/oz within six months last week, retained its “overweight” rating for the yellow metal and other commodities, including platinum, oil, copper and zinc. Goldman attributed the positive outlook for the prices to limited growth in supplies and demand from emerging economies.
Gold reached US$1,223/oz, while silver and platinum advanced to US$18.21/oz and US$1,529/oz respectively.
Major mining stocks were mixed today. Gold miners did well with Randgold Resources (LON:RRS) and African Barrick Gold (LON:ABG) advancing 1%, while peer form the FTSE 250 Petropavlovsk (LON:POG) climbed 2.3%.
Silver miner Fresnillo (LON:FRES) was flat and platinum miner Lonmin (LON:LMI) posted a small gain.
Specialty chemicals firm Johnson Matthey (LON:JMAT) was unmoved, as was silver producer Hochschild Mining (LON:HOC). Another midcap Aquarius Platinum (LON:AQP) rose 1%.
UK-registered China operating copper and gold miner Central China Goldfields (LON:GGG) led the sector with a 43% rally after upping the resource estimate for its Bullabulling gold project by 450% to 1.98 million ounces of gold. Gemstone producer Gemfields Resources (LON:GEM) followed with a 5.5% gain.
Africa operating gold miner GMA Resources (LON:GMA) moved in the opposite direction, slipping 9%. Western Australia operating Norseman Gold (LON:NGL) declined 5%.
