Gold stocks buoyed by rising bullion price

U.S. markets were little-changed over the report period Dec. 11-18, with the Dow Jones Industrial Average up 110.02 points (just over 1% of value) to a close of 9,998.39 on Dec. 18. The Standard & Poor’s 500 was almost unchanged at 1,142.92, up only 6.16 points from its Dec. 11 close.

Gold stocks drew strength from a US$6.65 rise in the gold price over the five trading days. Homestake Mining played out its last days with a US59 gain to US$8.62, with 6.3 million shares traded — perhaps the holders were arbitragers waiting for AngloGold to make a last-minute jump on the Barrick Gold bid. AngloGold extended its bid for Australia’s Normandy Mining in the hope it could get a favourable decision from the Australian Takeovers Panel on the legality and fairness of the rival bid from Newmont Mining. AngloGold ADRs had a good week on their own, though, adding US$1.48 to US$19.27, while Newmont settled for a US$1.19 rise to US$20.09.

Copper producers might have been buoyed by further news of production cuts at Codelco, but Phelps Dodge was down US$1.51 at $33 while Southern Peru was up a modest US20 at US$11.30. Overseas majors were mostly positive, except for BHP Billiton, which fell US25 to US$11.50. Rio Tinto tacked on US80 to finish at US$76.80, while over on the Nasdaq, Anglo American closed up US14 at US$15.58.