Gold Rising, Miners Continue Mixed

KGC, AU, ABX, GG, AUY, NEM, GLD

Investors were buying Gold Wednesday on the belief that re-elected President Obama will not be able to come up with a way to avoid having the US economy fall off the “Fiscal Cliff” at the end of this year.

Thursday, buyers were driven by the European Central Bank’s decision to leave its Key interest rate unchanged.

Either way, with deflation a threat in the US and inflation a threat in the Eurozone, Gold looks good. Gold ETFs added 4 tons of the precious Yellow metal yesterday, and now hold a record 2,592 tons of Gold.

Gold miners are sharing unequally in the Gold little boom in here. Kinross Gold Corp. NYSE:KGC reported Q-3 earnings last night that generated an analyst’s upgrade today, and the stock is up 6.5% as a result. AngloGold Ashanti Ltd. NYSE: AU missed estimates this morning on lower production, higher cash costs, and declining prices.

Kinross replaced its CEO in August and the new strategy is to allocate capital where it will bring the most return for shareholders. That’s not always been a priority for Gold miners, mainly because it’s hard to control ore quality, which has a big impact on cash costs, and impossible to control sales prices. If Kinross can make this strategy work consistently, the company will be the toast of the mining world. But 1-Q does not a trend make.

Other miners that have already reported earnings, including Barrick Gold Corp. NYSE:ABX, Goldcorp Inc. NYSE: GG, Yamana Gold Inc. NYSE:AUY, and Newmont Mining Corp. NYSE: NEM are all up about 0.5% today, but all except Yamana are either flat or off on the month.

The SPDR Gold Shares ETF (NYSEMKT:GLD) is up 0.7% today at 167.60 in a 52-wk range of 148.27 to 174.07.

Dec Gold closed settled today at 1,726.00 oz, up about 7% for the day.

AngloGold is trading down about 3% at 33.92 in a 52-wk range of 30.56 to 49.07.

Kinross is trading up 6.8% at 10.03 in a 52-wk range of 7.11 to 14.38.

Paul A. Ebeling, Jnr.

Paul A. Ebeling, Jnr. writes and publishes The Red Roadmaster’s Technical Report on the US Major Market Indices, a weekly, highly-regarded financial market letter, read by opinion makers, business leaders and organizations around the world.

Paul A. Ebeling, Jnr has studied the global financial and stock markets since 1984, following a successful business career that included investment banking, and market and business analysis. He is a specialist in equities/commodities, and an accomplished chart reader who advises technicians with regard to Major Indices Resistance/Support Levels.

 

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