GOLD PRICE NEWS - The gold price fell $10 to $1,122 as the lower price of gold pressured gold stocks and gold ETFs. The Market Vectors Gold Miners ETF (GDX), which contains many of the largest gold stocks in the world, followed the gold price lower as it dropped $0.39, or 0.8%, to $46.04 per share. Canadian-based Barrick Gold (ABX) and Yamana Gold (AUY) - two of the top ten largest components of the GDX - suffered losses of 1.1% and 2.7%, respectively. Weakness in both the gold price and gold stocks came as the U.S. Dollar Index (DXY) recovered nearly its entire 0.4% decline as the morning progressed, while the euro currency surrendered most of its earlier 0.5% gain against the greenback.

After rising last week to its highest level since the middle of January, at $1,122 the gold price was unable to build on its recent gains. In spite of today’s selloff in the gold price, however, the price of gold remained higher by $27, or 2.5% year-to-date, and $5, or 0.5% in the month of March. Meanwhile, after surging 6% in the previous week, the GDX turned negative for 2010 as market participants used the lower gold price as a catalyst to sell shares of gold stocks. Several small- and mid-cap gold stocks bucked the trend, however, as shares of Claude Resources (CGR) and San Gold (SGR.TSXV) - neither of which is a GDX component - climbed 1.0% and 0.3%, respectively.

In terms of specific news from the gold stocks sector, this week opened somewhat on the lighter side. However, there were a couple notable news items on which investors focused. Eldorado Gold (EGO) reported a 42% rise to 747,000 ounces in Proven and Probable gold reserves at its Eastern Dragon Project, a high-grade gold-silver deposit in China. The Vancouver, Canada based gold producer has budgeted $2.4 million for additional drilling in 2010 to continue exploring the main ore body and to test vein structures in the surrounding areas. In morning trading Eldorado Gold followed the broader gold stocks sector lower as it declined $0.17, or 1.3%, to $13.08 per share.

Novagold Resources (NG), a Canadian-based gold explorer, announced a non-brokered offering of $75 million in equity to Quantum Partners, a private investment fund managed by Soros Fund Management and founded by legendary investor George Soros. The announcement came just one week after Novagold raised $100 million in a previous equity offering, the proceeds of which were allocated to several funds managed by Paulson & Company - the hedge fund run by John Paulson. Novagold stated that it plans to use the net proceeds from these financings to fund general exploration and development on its advanced properties - including Donlin Creek, Galore Creek and Rock Creek, its early-stage Ambler property - and for general corporate purposes, including funding potential future acquisitions. After earlier this morning rising by as much as 2.4%, shares of Novagold Resources retreated $0.03, or 0.5%, to $6.32 in mid-day trading.