Gold shares surged higher Friday amid a broad-based rally on Wall Street. The AMEX Gold Bugs Index (HUI) – comprised of the world’s largest gold producers – climbed 3.8% to 603.92 in afternoon trading. In doing so, the HUI was on pace for its best day since a 4.4% surge on October 5th of this year.
Three of the HUI’s largest advancers were Barrick Gold (ABX), Goldcorp (GG), and Harmony Gold (HMY). ABX jumped by 4.1% to $53.18, GG by 5.2% to $54.05, and HMY by 4.1% to $14.26 per share.
Precious metals equities were bolstered by gold futures, which added $28.50, or 1.6%, to $1,788.10 per ounce following the COMEX close this afternoon. The yellow metal headed north amid weakness in the U.S. dollar – which fell 0.9% against a composite of the world’s leading fiat currencies.
The broader equity markets posted large gains as well, with the S&P 500 Index higher by 2.0% at 1,263.82. With the advance, the S&P returned to positive territory on the week – despite retreating 3.7% on Wednesday – its worst day since August 18, 2011.
The primary catalysts for the rally on Wall Street were a decline in Italian bond yields and a better than expected U.S. economic report. The yield on Italy’s ten-year bond fell back below the key 7% level as euro zone sovereign debt fears subsided a bit, at least for one day. The euro currency rebounded from losses earlier in the week to trade up 1.0% to 1.3747 against the U.S. dollar.
There were few if any concrete reasons for the improvement in Italian markets, as policymakers did not hold any noteworthy meetings or announce any new plans for combating the crisis. Instead, today’s move was likely a short covering rally based on technical and sentiment factors.
In the U.S., University of Michigan Consumer Sentiment came in at 64.2 – well above the 61.5 consensus estimate among economists.
Crocodile Gold Reports High Grade Results at Cosmo
- 8 meters (m) of 15.69 grams per tonne (g/t) of gold (Au) in hole CE102516
- 6 m of 11.40 g/t Au in hole CE102513
- 3 m of 13.29 g/t Au in hole CE102510