U.S. markets, Aug. 19-23

Poor housing data in the U.S. showed sales of new single-family homes fell in July to a nine-month low, which fuelled debate over the status of the Federal Reserve’s stimulus program. Mounting tension over Syria created more uncertainty. The Dow Jones Industrial Average posted its third weekly decline, down 0.5% to 15,010.51, while the S&P 500 Index added 0.5% to 1,633.50, and the Nasdaq Composite climbed 1.5% to 3,657.792. The New York spot price for gold ended at US$1,397.80 per oz., up US$20.6 per oz., or 1.5%, and the Philadelphia Gold & Silver Index gained 1.94% to 111.39.

Royal Gold jumped US$2.29 per share to US$63.95 on no news. Earlier in August the company reported financial results for the 2013 fiscal year ended June 30, with net income attributable to shareholders of US$69.2 million, or US$1.09 per share, on record annual royalty revenue of US$289.2 million. In fiscal 2012, the company reported net income of US$92.5 million, or US$1.61 per share, on royalty revenue of US$263.1 million. Royal Gold also bought a 70% stake in a 2% net smelter return royalty on Xstrata Copper’s El Morro copper-gold project for $35 million.

Silver Wheaton advanced US93¢ to US$27.70 per share on no news. In mid-August the streaming company reported record attributable silver-equivalent production in the second quarter of 8.6 million oz. (6.4 million oz. silver and 35,600 oz. gold), up 28% from the 6.7-million equivalent oz. silver in the second quarter of 2012. Second-quarter revenues of US$166.9 million fell 17% year-on-year from US$201.4 million, while net earnings dropped 50% to US$71.1 million, or US20¢ per share from US$141.4 million, or US40¢ per share in the second quarter of 2012. 

First Majestic Silver shares rose US88¢ to US$15.43 per share. In August the company reported a 55% rise in production in the second quarter to 3.27 million equivalent oz. silver. But in response to low prices in the quarter, the company held 700,000 oz. silver in inventory, lowering revenues by 12% year-on-year to $48.4 million. Net earnings came in at $0.2 million, compared to $15.3 million in the second quarter of 2012. If silver sales had not been suspended, the company says, they would have added about $7.6 million. 

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