GOLD STOCKS NEWS – Gold stocks held steady Wednesday as the Market Vectors Gold Miners ETF (GDX) rose 0.2% to $59.79 per ounce. The modest rise in gold stocks and the GDX came as gold bullion inched higher by $0.96 to $1,589.46 per ounce, following yesterday’s $16 slide. The S&P/TSX Global Gold Index, Canada’s leading gold stocks composite, advanced 0.3% alongside the GDX.
In concert with today’s advance in gold stocks, the sector has rebounded significantly this month. Since June 30, the GDX has surged 9.2%, compared to a 6.0% rise for the yellow metal. In doing so, the GDX is on pace for its best month since an 11.0% climb in February of this year. With gold bullion breaking out to a new record high above $1,600 per ounce this week, gold stocks have been a prime beneficiary.
While news in the gold stocks was relatively light on Wednesday, one company making headlines was Agnico-Eagle Mines (AEM), a Canadian-based gold producer. Shares of AEM bucked the trend of higher gold stocks, dropping 0.5% to $63.14. The sell-off was fueled by a downgrade from RBC Capital Markets, to Sector Perform from Sector Outperform. The firm did not provide a price target on AEM, however.
Looking ahead to the rest of the week, there are several catalysts likely to impact gold stocks and the GDX. In Europe, investors will be keeping a close eye on Thursday’s Greece summit, where policymakers hope to craft a resolution to the nation’s sovereign debt crisis. Jose Manuel Barroso, head of the European Commission, stated yesterday that “Nobody should be under any illusion: the situation is very serious. It requires a response, otherwise the negative consequences will be felt in all corners of Europe and beyond.”
In the United States, several key economic reports are scheduled for release on Thursday. These include weekly jobless claims, the Philadelphia Fed Index, Leading Indicators, and the Federal Housing Finance Agency’s (FHFA) Housing Price Index. If the economic data comes in below economists’ expectations, gold stocks and gold bullion are likely to benefit, as evidence mounts that the economy is continuing to slow. However, if the reports offer encouraging signs, gold stocks may fall victim to selling pressure.
Notable gold stocks moving higher alongside the GDX on Wednesday included Barrick Gold (ABX), IAMGOLD (IAG), and Yamana Gold (AUY). In morning trading, ABX, IAG, and AUY advanced 0.2%, 1.6%, and 0.7%, respectively.
Extorre’s Gold-Silver Discovery Advances
Exploration drilling continues to extend gold-silver mineralization at Extorre’s 100% owned Cerro Moro project in Santa Cruz Province, Argentina. The emerging precious metals company highlighted assay results from drilling undertaken during the second quarter of 2011 and on prospects other than its recent Zoe discovery. Full Extorre Gold Mines Press Release.
- MD1254 (Gabriela vein) intersected 7.37 metres (“m”) at 6.3 grams per tonne (“g/t”) gold + 853 g/t silver (23.4 g/t gold equivalent*), including 0.76m at 15.1 g/t gold + 1,835 g/t silver (51.8 g/t gold equivalent*) and 1.46m at 16.5 g/t gold + 2,347 g/t silver (63.4 g/t gold equivalent*).
- MD1261 (Carla vein) intersected 10m at 17.5 g/t gold + 544 g/t silver (28.3 g/t gold equivalent*), including 2.05m at 61.4 g/t gold + 2,090 g/t silver (103.2 g/t gold equivalent*).
- MD1211 (Esperanza vein) intersected 5m at 6.4 g/t gold + 448 g/t silver (15.3 g/t gold equivalent*), including 0.8m at 34.4 g/t gold + 1,940 g/t silver (73.2 g/t gold equivalent*).