Golds up in volatile market

Gold stocks were among the winners on U.S. equity markets during the trading period Dec. 6-12, as the broader market gyrated first in response to favourable economic statistics and later to another rise in energy prices. The market also anticipated a quarter-point rise in the Federal Reserve Bank’s primary interest rate, which the Fed announced on Dec. 13. Despite the daily variations, at the end of the period the Dow Jones Industrial Average was down only 67.24 points at 10,767.77, while the Standard & Poors 500 index fell a mere 1.66 points to 1,260.43.

Gold prices were up drastically: the London bullion price was fixed at US$536.50 per oz. on the afternoon of Dec. 12, US$30.85 higher than a week before. Silver broke US$9 on Dec. 12 and platinum US$1,000 on Dec. 9, before all the precious metals retreated in anticipation of the Fed’s rate increase.

That translated into big gains for the big golds: Newmont Mining was up US$3.56 at US$50.40, AngloGold Ashanti rose US$3.60 to US$46.93, Gold Fields rose US$1.66 to US$16.92, and Harmony Gold Mining US96 to US$13.21. The gains were more muted in the middle tier, with Randgold Resources up US8 to US$15.79, Lihir Gold up US$1.47 to US$33.47, and Minas Buenaventura up US$1.87 to US$31.22.

The base metal equities were mixed. U.S. and Latin American producers mostly fared poorly: Phelps Dodge was off US$1.13 at US$140.35, Southern Peru Copper backed off US59 to US$68.73, and Companhia Vale do Rio Doce fell US$1.84 to US$42.26. The big offshore boys, on the other hand, fared well: Anglo American was up US$1.58 to US$33.72 on the Nasdaq, while over on the big board BHP Billiton rose US13 to US$33.14 and Rio Tinto picked up US$3.58 to finish at US$175.60.