GOLD PRICE NEWS – The gold price inched lower on Monday amid further weakness in precious metals and a modest advance in the U.S. dollar. The spot price of gold dipped $4.46, or 0.3%, to $1,654.94 per ounce while the U.S. Dollar Index rose by 0.1% to 79.813. The SPDR Gold Trust (GLD), the world’s largest gold price proxy and gold ETF, fell $0.46, or 0.3%, to $160.19 per share.
Silver fared worse than the price of gold, as it slipped by $0.43, or 1.4%, to $30.81 per ounce. Among other precious metals, platinum futures dropped by 1.5% to $1,670.01 per ounce, while palladium bucked the trend with a 0.3% rise to $743.50 per ounce. As for cyclical commodities, copper futures advanced by 0.2% to $3.66 per pound while crude oil added 0.3% to $96.18 per barrel.
Gold stocks came under selling pressure alongside the gold price, as the Market Vectors Gold Miners ETF (GDX) retreated by $0.32, or 0.8%, to $41.60 per share. The sector also lagged the broader equity markets, as the S&P 500 Index fell by just 0.1% to 1,501.19.
Notable gold stocks in the red included GDX components Harmony Gold (HMY), Kinross Gold (KGC), and Newmont Mining (NEM). Shares of HMY slid by 2.7% to $6.79, KGC by 2.6% to $8.31, and NEM by 1.4% to $42.67.
Looking to the week ahead, the U.S. economic calendar is particularly full of items likely to impact the price of gold and the broader financial markets. This morning, Durable Goods for December increased by 4.6%, well above the 2.5% consensus estimate among economists. However, Pending Home Sales for last month declined by 4.3%, missing the unchanged mark economists were expecting.
Tomorrow’s schedule includes the Case-Shiller home price index, along with a report on Consumer Confidence. On Wednesday, data on fourth quarter GDP and the ADP Employment report will be released, as well as the always-critical Federal Reserve’s Federal Open Market Committee (FOMC) meeting and monetary policy decision. Thursday’s docket includes reports on Weekly Jobless Claims and the Chicago Purchasing Managers’ Index, and the week then concludes on Friday with the Nonfarm Payrolls Report, Unemployment Rate, University of Michigan Consumer Sentiment Index, and the ISM Index.
Commenting on the outlook for gold prices, Frederic Panizzutti stated that “The market is on hold ahead of the U.S. Federal Reserve’s meeting, and expects comments on further quantitative easing measures…Today’s trade should be pretty quiet, with gold players watching euro/dollar movements, looking for any indication of what is going to happen in the next few days.”
Aurizon Mines’ Board Unanimously Recommends Rejecting Alamos Offer
Aurizon noted that the Alamos offer, based on the closing price of Alamos on January 22, 2013, represented a value of C$4.55 per Share assuming full pro-ration of the Alamos Offer consideration; this is a 4.1% discount to the closing price of Aurizon's shares on the same day and a 21% discount to the 52-week high share price of Aurizon. The Company also pointed out that the C$4.65 price has never been available to Aurizon shareholders, based on the implied offer value, since the Alamos offer announcement was made. Based on the current Alamos offer value of C$4.55 per share, the effective premium to Aurizon shareholders has eroded 4% relative to the closing price of the Aurizon Shares on January 11, 2013 – the last trading day prior to the Alamos offer announcement. Full Aurizon Mines Press Release.
- The Board's recommendation is based in part on the recommendation of the Special Committee and the advice from financial advisors to Aurizon and the Special Committee and follows a thorough review process, undertaken in consultation with its financial and legal advisors
- The Board noted that it has serious concerns about unequal treatment of Aurizon shareholders as a result of Alamos having entered into private share purchase agreements with certain shareholders of Aurizon immediately prior to the commencement of the Alamos Offer
- The Board intends to seek shareholder ratification of a shareholder rights plan at a special meeting of shareholders on March 7, 2013 in order to provide the Board with adequate time and measures to respond to unsolicited takeover bids
