Gold prices are oscillating around the level of US$1,500 despite shorts development in the market as the bulls remain confident over the dark clouds hovering above the global economic conditions. Gold as a safe-haven has witnessed a strong trend during the first and second quarter of the year (or in the first half of 2019).
While many speculators anticipate a short-term price correction in gold as it moved into an overbought zone; the industry experts are confident over the strong fundamentals behind gold and are eyeing for the level of USS$2,000 an ounce.
The escalating trade tussle between the two most significant economies of the globe is curbing the global economic growth via chocking the free trades.
However, the current speculation, which favours the short-sellers is dominating the market, due to which gold spot prices have witnessed a slight correction from the level of US$1,534.94 (Day’s high on 13 August 2019)
Jackson Hole Symposium and the Market Speculation:
Jackson Hole Symposium serves as the early indication from global central banks over future monetary policies. While the global economic conditions are gloomy and the bond yields are under a free-fall mode, this August 2019 Jackson Hole Symposium is becoming one of most anticipated in years.
The Fed watchers are now anticipating that the United States Fed Chair Jerome Powell is likely to use the stage to suggest that the central bank is ready for a rate cut. The bullion investors and speculators are closely eyeing the event and waiting for the Fed opening speech.
While there is a group, which believes that the Fed would indicate towards the future rate cut to open the blocked gateways for economic growth; the market speculators are clinching to the Fed’s previous explanation for the rate cut.
In his address to the media, the Fed Chair previously explained the rate cut as a mid-cycle adjustment, which generated a short-term fall in the gold prices. The market speculators are anticipating a similar move by the Fed, which in turn, is leading the gold prices toward a short-term correction.
Gold Strong Trends in 1H CY2019:
Gold demand has witnessed some substantial numbers in the first half of the year 2019. The central bank added 374.2 tonnes of gold in their vaults during the first half of the year 2019, which in turn, underpinned the growth of over 57 per cent as compared to the total demand of 237.6 tonnes during the previous corresponding period of 1H CY2018.
While the gold prices have experienced a bull run in the recent quarters, the ASX-listed gold players have witnessed an upside as well, because gold mining shares in Australia remains a potential asset class for investors to take the gold exposure while exposing their portfolio to the commodity market volatility.
ASX-listed Gold Mining Stocks:
Evolution Mining Limited (ASX: EVN)
EVN an ASX-listed gold miner, has delivered healthy monthly returns from the staring of the year 2019. The gold mining stock encashed the bull rally in gold prices and rose on ASX, which in turn, improved the total returns profile of the company.
Monthly Total Return Profile:
The gold miner has managed to deliver steady yearly dividend yields along with high return from the price appreciation.
Northern Star Resources Limited (ASX: NST)
The gold mining stock on ASX has delivered superior monthly total returns from the beginning of the year. The MTD returns stand at -12.38 per cent, while the YTD returns delivered by the ASX-listed gold-stock stand at 24.52 per cent.
Monthly Total Return Profile:
The dividend yields delivered by the company remains steady; however, there is no particular uptrend or downtrend observed in the dividend yields of the stock.
Newcrest Mining Limited (ASX: NCM)
NCM’s shares delivered decent monthly returns with a YTD of 60.36 per cent.
Monthly Total Return Profile:
The dividend yields of the company have witnessed the growth over the past four years; however, the current dividend yields of the company remain lower from the previous financial year.
While many other gold miners have delivered strong returns amidst the gold rush, few ASX-listed gold miners have significant progress to inch up their respective gold production to leap further.
Resolute Mining Limited (ASX: RSG)
In the status quo, RSG has acquired the Mako gold mine to increase the exposure over the gold reserves in Africa. The Syama gold mine of the company in Africa has already produced record levels of gold in the June 2019 quarter.
The acquisition of the Mako Gold mine in Africa provides the African projects of the company an additional production capacity with a low operating cost. The African Mako mine hosts 1.2 million ounces of Mineral Resources and 0.9 million ounces of Ore Reserves with seven years of mine life.
Tribune Resources Limited (ASX: TBR)
The ASX-listed gold miner-TBR has recently updated its Mineral Reserves and Ore Resources at its East Kundana Joint Venture in which TBR and Rand Mining Limited (ASX: RND) hosts 49 per cent interest; while 51 per cent interest is controlled by Northern Star.
The prospect contains three underground deposits, namely, Raleigh, Rubicon, and the Hornet. The recent update in the Mineral Resources at the Joint Venture increased the Mineral Resources by 123,000 ounces.
As per the data, the total Mineral Resources of the prospect now stands at 11.27 million tonnes with an average grade of 6.0 gram per tonne, which in turn, contains 2.19 million ounces of gold.
Likewise, the Ore Reserves of the prospect inched up by 146,000 ounces to stand at 6.10 million tonnes with an average grade of 5.6 gram per tonne, which in turn, would account for 1.09 million ounces of gold.
Dacian Gold Limited (ASX: DCN)
Dacian Gold Limited recently updated its existing mine life plan for its MMGO operations. This should allow the company an sustainable average annual production of 170,000 ounces of gold over the initial five years.
Saracen Mineral Holdings Limited (ASX: SAR)
The ASX-listed gold miner- SAR recorded an NPAT of A$92.5 million in FY2019, up by 22 per cent from FY2018. The gold production for the financial year 2019 of the company jumped by 12 per cent to stand at 355,077 ounces with over 9.50 per cent decline in all-in sustaining cost.
The higher production coupled with lower cost extended the cash and equivalents of the company by over 30 per cent at A$154.4 million in FY2019.
SAR exploration expenditure for the financial year 2019 stood at A$217 million, which as per the company, provided SAR with an ability to maintain its target production of 400,000 ounces a year for the next seven years along with additional resources to help with further growth and mine life extensions.
The financial year 2019 for most of the ASX-listed gold miners has seen a strong production and revenue, few miners such as Regis Resources Limited (ASX: RRL), Gold Road Resources (ASX: GOR) have recently witnessed a drastic fall in the share prices.
Despite record production of 363,418 ounces and higher realised price pf A$1,765 per ounce in the financial year 2019, the share prices of RRL have taken a jab amid increased cost of sales, which absorbed the NPAT for FY2019.
The NPAT of the company for FY2019 stood at A$163.1 million, down by over 6.30 per cent as compared to the previous financial year NPAT of A$174.2 million.
Gold Road Resources Limited (ASX: GOR)
Gold Road Resources recently inched up its reserves; however, the recent offloading of the company’s shares by the global gold mammoth– Gold Fields Limited, dragged the shares over 22 per cent in the single trading session on 23 August 2019.
In a nutshell, the recent gold rush amid strong fundamentals propelled the ASX-listed gold stocks, and in the status quo, the ASX-listed gold miners are adding additional resources to take advantage of the predicted high gold prices in the years coming ahead.
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