GOLD PRICE NEWS – The gold price declined Wednesday, sliding $8.00 to $1,772.75 per ounce. Gold prices fell alongside broad-based weakness in global equity markets. The euro retreated against the U.S. dollar after a Bank of England statement warning that Europe’s sovereign debt crisis may have a “significant adverse” impact on the economy. S&P 500 stock futures fell 12.40 to 1241.70. Bucking the downtrend was crude oil, which broke out through $100 per barrel for the first time since July.
On Tuesday, the gold price stabilized near $1,780 per ounce despite further strength in the U.S. dollar. The SPDR Gold Trust (GLD), the world’s largest gold ETF and a proxy for the price of gold, fell 1.10 to 172.26 per share ahead of the opening bell on Wall Street. Silver prices, which climbed yesterday amid a broad-based rally in cyclical commodities, fell 1% to $34.19 per ounce. Gold’s sister precious metal gave back all its gains posted on Tuesday. Copper fell 1.6% to $3.46 per pound this morning.
Gold shares, which finished modestly higher yesterday, traded lower Wednesday morning as the sector fell alongside the gold price and the broader equity markets. The AMEX Gold Bugs Index (HUI) inched higher yesterday, while the S&P 500 Index added 0.5% to 1,257.81. Equities turned higher after a better than expected report on U.S. retail sales, with which a 0.5% rise in October handily beat the 0.2% consensus estimate among economists. Within the gold sector, notable advancers included Agnico-Eagle Mines (AEM) and Royal Gold (RGLD), which rose 0.9% and 1.3%, respectively.
The gold price initially slid to as low as $1,759.10 per ounce in overnight trading after the release of Paulson & Co.’s latest 13-F filing. The firm – run by hedge fund magnate John Paulson – has been the largest holder of the GLD since the first quarter of 2009. The 13-F filing disclosed that Paulson & Co. sold 11.2 of its 31.5 million GLD shares during the third quarter of this year.
In spite of the sales, Paulson & Co. remains the largest holder in the GLD, with 20.3 million shares. Speculation arose that he may have sold at least a portion of fund redemptions, which were roughly 10% according to numerous reports. While Paulson reduced his GLD holdings, legendary investor George Soros increased his stake. Soros Fund Management raised its holdings from 42,800 as of June 30 to 48,350 shares. Other notable hedge fund managers – including Paul Tudor Jones and Paul Touradji – went from not having a GLD position as of June 30 to holding 200,000 and 45,000 shares, respectively, as of September 30.
Looking ahead, it is evident that despite Paulson’s sales, many highly-respected investors continue to accumulate significant positions tied to the gold price. The fact that Soros – who earlier this year was quoted as saying that gold is “the ultimate bubble,” – raised his GLD stake speaks to the strength of the yellow metal’s bull market.
As for Paul Tudor Jones, in October 2009 he wrote in an investor letter that “It (gold) is just an asset that, like everything else in life, has its time and place. And now is that time.” Based on his more recent actions, it appears that the gold price continues to have time on its side.
Aurizon Hits High-Grade Gold at Marban Block
Aurizon reported results from the last 31 drill holes of the first phase program, of which 14 of the holes are on the Marban deposit and 17 are step out holes that tested the area between the Marban and Norlartic deposits. Full Aurizon Mines Press Release.
- An additional important near surface mineralised interval of 9.8 grams per tonne (g/t) of gold over 5.8 meters (m) was obtained in the newly recognized Marban High Grade Western Zone
- Drilling within the Marban deposit continues to confirm the continuity of the mineralized zones near surface as well as their extensions below the Marban mine
- An interval of 5.9 g/t of gold over 3.6m was obtained at a vertical depth of 350m in the newly recognized Marban Eastern Down Dip Zone.
