This Day On The Street
Continue to site
ADVERTISEMENT
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here

Gold Prices Gaining On Concerns In Europe

By Dave Brown — Exclusive to Gold Investing News

Gold Prices Gaining on Concerns in Europe

The price of gold increased almost $17 to the range of $1,677.40 per troy ounce, potentially extending its highest one-week gain in six weeks. T he Eurozone debt crisis is a major reason for this volatility, which is being demonstrated in the risk appetite of traders and investors. Overall, spot market gold prices have appreciated by about three percent this week.

This week saw mixed results in an Italian bond auction, with Spanish bond yields reaching nearly six percent, a level perceived to be unsustainable for the government to service its debt. Spain announced more austerity measures, and the head of the central bank warned that the country's commercial banks will need more capital if the economy deteriorates further.

According to Kitco, the gold to silver ratio rose to around 51.7, an increase from a week ago that highlights the outperformance of gold. The ratio is a benchmark for traders and investors, and compares the number of troy ounces of silver needed to obtain one troy ounce of gold.

For investors, a major driver of gold prices over the next few days could be the anticipated release of the US Consumer Price Index (CPI). This month, the Bureau of Labor Statistics is making significant changes to the format of the index. Charts will be restructured to focus on three broad categories: Food, Energy, and All Items Less Food and Energy.

According to the median estimate in a Bloomberg survey, the CPI climbed 0.3 percent last month after gaining 0.4 percent in February. A disappointing result in the data could stimulate increased pressure on gold prices in anticipation of a change in policy from the Federal Reserve. A stronger than expected number could result in a contraction for gold prices.

Company news

AngloGold Ashanti Ltd. (NYSE: AU) missed its output target, producing about 980,000 ounces of gold in the first quarter. Production was constrained by overall safety stoppages as well as unforeseen repairs at the main shaft of the Obuasi mine in Ghana. Safety stops cut 76,000 ounces, approximately the equivalent of $126 million at current prices. There will be a “consequential impact” on the cost of gold production for AngloGold, as it was previously expecting to produce gold at a cash cost of $820 to $835 per troy ounce.

Five workers, including one injured in September, died after accidents at South African operations during the previous quarter, while one was killed in Argentina. Mining fatalities in South Africa declined to 123 last year from 127 in 2010, while injuries were reduced by 15 percent to 2,918.

Junior company news

Avrupa Minerals Ltd. (TSXV: AVU) purchased the remaining ten percent interest in MAEPA. This agreement will put Avrupa in a better position to negotiate with its mineral property interests for potential Portuguese joint venture partners.

Bravada Gold Corp. (TSXV: BVA) has significantly increased its resource estimate for its Wind Mountain property since its 2007 report. The company is expecting results from its preliminary economic assessment at the property over the next seven weeks and is expecting to follow with a technical report on SEDAR.

Source Exploration Corp. (TSXV: SOP) filed a NI 43-101 technical report titled “Technical Report on the Capricho Au-Ag Property, Sinaloa State, Mexico” on SEDAR.

 

1 of 2

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free
Dividend Stock Advisor

David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Options Profits

Our options trading pros provide over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • Actionable options commentary and news
  • Real-time trading community
SYM TRADE IT LAST %CHG

Markets

Chart of I:DJI
DOW 16,643.01 -11.76 -0.07%
S&P 500 1,988.87 +1.21 0.06%
NASDAQ 4,828.3250 +15.6170 0.32%

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs