Gold stocks have had a difficult year. As a group, they underperformed gold bullion; however, there have been signs of life, as a large number of buyers have stepped in over the recent weeks to accumulate shares of gold stocks. One of these gold stocks that have had some issues in relative performance is Barrick Gold Corporation (NYSE/ABX). Recently Barrick Gold’s CEO Aaron Regent was let go due to the .
Much has been written about the underperformance of gold stocks versus gold bullion. For many investors in gold stocks, this has been a frustrating period of time to see so many undervalued and cheap companies not being able to move up in price. This divergence appears to have shifted over the last couple of days, as we’ve seen gold stocks outperform gold bullion and I think this trend might continue.
The volatility in oil prices has been significant over the past year. These last few weeks has actually seen a lot less volatility almost the “calm before the storm.” Oil prices, as with all commodities, functions based on supply and demand. We can see a lot of these issues played out in the actual oil prices themselves through technical analysis.
Chart courtesy of www.StockCharts.com
This is a one-year, daily chart .
A lot of talk has been focused on gold bullion over the past few years. The question I’ve been asked lately is: has this decade-long run in gold prices come to an end or will it continue?
Let’s look at it from two perspectives. From a fundamental stance, recent economic data points to continuing weakness in many if not most economies around the world. We here at Profit Confidential have .
Right now, precious metal stocks aren’t performing that well, even though many gold mining companies are reporting record production and earnings. Furthermore, corporate visibility at many gold mining companies is rosy, yet, as a group, precious metal stocks are mostly down since the beginning of the year. The reason, of course, is that spot prices for gold and silver have pulled back in price, but in my view, the pullback .
Much time has been spent recently discussing the up and down moves in the price of gold bullion. People with a long-term investment strategy need to weigh a lot of different variables when determining what they should be doing with their funds and the varying factors that are impacting the price of gold bullion.
Gold bullion has been a store of value for thousands of years and in some cultures .
We are seeing some calm return to the equity markets after Greece managed to convince its debt holders to take a loss of over $200 billion. The aftermath has hurt gold, as the precious metal has hit a snag; it’s down below $1,700 and looking to a possible retest at $1,600. A break below could send the precious metal down to $1,525.
With the current weakness in gold, I do .
By Sasha Cekerevac, BA• Thursday, February 9, 2012
Following the news of Glencore International plc’s purchase of Xstrata Plc, which will create a diverse firm involved in a variety of precious metals, there is increased investor interest in mining companies, with everyone looking over their shoulder, asking, “Who’s next?”
Since the deal is so large, this essentially raises the bar for other mining companies about who can be acquired and for what price. It used to be that .
For years, I’ve been a bull on gold mining stocks, but also precious metals stocks in general.
Gold mining stocks and precious metals stocks did not perform very well last year (compared to recent years), but that doesn’t mean there is no value in them. Usually, when a sector like this is beaten down or forgotten by the market in general, value players come in and buy it up (myself, .
After the tech bubble in March 2000 popped and before the recent financial and credit crises struck, at least three sectors have managed to post significant gains: bonds; real estate; and small-caps. For some reason, however, gold remained under the radar for most investors. Yet, since the stock market peak, prices have climbed past many psychological marks. The shares of companies that mine the metal have gone for the ride..
Immediate term outlook:
The bear market rally in stocks that started in March 2009, extended because of unprecedented central bank money printing, is coming to an end. Gold bullion is up $1,000 an ounce since we first recommended it in 2002 and we are still bullish on the physical metal.
Short-to-medium term outlook:
World economies are entering their slowest growth period since 2009. The Chinese economy grew last year at its slowest pace in 24 years. Japan is in recession. The eurozone is in depression. With almost half the S&P 500 companies deriving revenue outside the U.S., slower world economic growth will negatively impact revenue and earnings growth of American companies. Domestically, America’s gross domestic product grew by only a meager 2.3% in the second quarter, which will negatively impact an already overpriced equity market.