Gold prices dropped for the third consecutive day, with Gold Spot (XAU) slipping from the level of $1279.87 (Day’s high on 22nd April 2019) to currently hovering around $1272.24.
The gold prices previously nosedived over the improvement in sales figure and over decreasing unemployment claims in the United States. The improvement in both the figures supported the dollar prices, which pulled down gold prices.
Dollar Index rose from the level of 97.26 (Day’s low on 22nd April) to the level of 97.78 (Day’s high on 23rd April) initially; the prices are currently hovering around the level of 97.67.
The fear of improving global economic condition concerned the bullion investors, and the bullion market marked a sell-off. The improvement in the global economic conditions led the investors to become more risk tolerant and their expectation of a high return from other asset classes exerted pressure on gold prices.
The fall in gold prices hampered the financial strength of the gold miners, and the gold miners on the Australian Stock Exchange witnessed a decline in their stock prices.
The gold miners react to the change in gold prices as the sale proceeds of the miners depend upon the market prices of gold and in a simple relation, high gold prices lead to high sales proceed; thus, strengthening the balance sheet and vice versa.
How are Gold prices pulling strings of Gold Miners?
Evolution Mining Limited (ASX: EVN)
The share prices of the company started to witness a fall with the fall in gold prices. The gold prices (XAU) started plunging from the level of $1308.43 (Day’s high on 11th April 2019, which dragged the miner as well. The share prices of the company dropped from the level of A$3.750 (Day’s high on 11th April 2019) to the level of A$3.160 (Day’s low on 23rd March 2019) amid a falling scenario of gold prices.
During the day’s session today (24 April 2019), the share prices started trading at A$3.210 and fell to register the low of A$3.170; however, the prices recovered and closed at A$3.200, unchanged as compared to its previous close.
Saracen Mineral Holdings Limited (ASX: SAR)
The share prices of the company fell from the level of A$2.960 (Day’s high on 10th April 2019) to the level of A$2.470 (Day’s low on 23rd April 2019), over the falling gold price scenario.
During the day’s session today (24 April 2019), the shares started trading at A$2.590, before dropping to the level of A$2.540. The shares of the company ended the day’s session at A$2.560, down by 1.16% as compared to its previous close.
Regis Resources Limited (ASX: RRL)
The Share price of the company nosedived from the level of A$5.280 (Day’s high on 10th April 2019) to the level of A$4.720 (Day’s low on 23rd April 2019). The shares of the company plunged significantly until A$4.730 post starting the day session at A$4.840 on 24 April 2019. The stock ended the day session at the day’s low.
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