Gold update

Due to the strengthening of the U.S. dollar and the rise in bond yields from 2020 lows, the price of precious metals has fallen. Large gold miners listed in the United States have shrunk by one-fifth this year.

New York Stock Exchange Gold Bugs Index fall It has risen by 20% since the end of last year, to its lowest level since April 2020, and is far behind the 11% increase in the MSCI Global Stock Market Barometer.

Since then, gold has fallen by 14% Set a record In August last year, each troy ounce exceeded US$2,000.

A stronger U.S. dollar weakens the attractiveness of metals, which makes metals more expensive for international buyers, and Bond yields rise Compared with this time last year. Unlike bonds, gold does not provide a source of income. The rise in global stock markets has also weakened its appeal.

“People are afraid of higher interest rates,” said Robert Minter, director of investment strategy at Aberdeen Standard Investments. “This is’sell everything, dump the baby and bath water together.’ Whenever gold falls like this, it is a continuous opportunity for us.”

Although the industry has increased its dividend and promised to reduce its dividend, the lower gold price has dampened investor confidence in gold miners Environmental footprintAccording to Joe Foster, fund manager of VanEck in New York.

“When gold is in trouble, it is basically not important to these gold companies,” Foster said.

The share price of Newmont, the world’s largest gold mining company, has fallen 6% this year, while the share price of Barrick Gold has fallen 16%.

“Unprecedented” number Stock repurchase According to BMO Capital Markets, this year also showed that many miners believe their stocks are undervalued. Yamana Gold and Canadian counterpart Kinross Gold announced that they will repurchase shares this year.

Yamana’s stock price has fallen 27% this year, while Kinross Gold’s stock price has fallen 23%.

Mark Bristol, CEO of Barrick Gold, the world’s second-largest gold miner, said this month that the gold industry needs Focus on growth Instead of pacifying shareholders with cash returns.

“The long-term tendency of the gold mining industry to harvest gold prices rather than invest in the future has led to a decline in reserves and a shortage of high-quality development projects,” he said.

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