Best of the Week
Most Popular
1. The Trump Stock Market Trap May Be Triggered - Barry_M_Ferguson
2.Why are Central Banks Buying Gold and Dumping Dollars? - Richard_Mills
3.US China War - Thucydides Trap and gold - Richard_Mills
4.Gold Price Trend Forcast to End September 2019 - Nadeem_Walayat
5.Money Saving Kids Gardening Growing Giant Sunflowers Summer Fun - Anika_Walayat
6.US Dollar Breakdown Begins, Gold Price to Bolt Higher - Jim_Willie_CB
7.INTEL (INTC) Stock Investing to Profit From AI Machine Learning Boom - Nadeem_Walayat
8.Will Google AI Kill Us? Man vs Machine Intelligence - N_Walayat
9.US Prepares for Currency War with China - Richard_Mills
10.Gold Price Epochal Breakout Will Not Be Negated by a Correction - Clive Maund
Last 7 days
Double Top In Transportation and Metals Breakout Are Key Stock Market Topping Signals - 18th July 19
AI Machine Learning PC Custom Build Specs for £2,500 - Scan Computers 3SX - 18th July 19
The Best “Pick-and-Shovel” Play for the Online Grocery Boom - 18th July 19
Is the Stock Market Rally Floating on Thin Air? - 18th July 19
Biotech Stocks With Near Term Catalysts - 18th July 19
SPX Consolidating, GBP and CAD Could be in Focus - 18th July 19
UK House Building and Population Growth Analysis - 17th July 19
Financial Crisis Stocks Bear Market Is Scary Close - 17th July 19
Want to See What's Next for the US Economy? Try This. - 17th July 19
What to do if You Blow the Trading Account - 17th July 19
Bitcoin Is Far Too Risky for Most Investors - 17th July 19
Core Inflation Rises but Fed Is Going to Cut Rates. Will Gold Gain? - 17th July 19
Boost your Trading Results - FREE eBook - 17th July 19
This Needs To Happen Before Silver Really Takes Off - 17th July 19
NASDAQ Should Reach 8031 Before Topping - 17th July 19
US Housing Market Real Terms BUY / SELL Indicator - 16th July 19
Could Trump Really Win the 2020 US Presidential Election? - 16th July 19
Gold Stocks Forming Bullish Consolidation - 16th July 19
Will Fed Easing Turn Out Like 1995 or 2007? - 16th July 19
Red Rock Entertainment Investments: Around the world in a day with Supreme Jets - 16th July 19
Silver Has Already Gone from Weak to Strong Hands - 15th July 19
Top Equity Mutual Funds That Offer Best Returns - 15th July 19
Gold’s Breakout And The US Dollar - 15th July 19
Financial Markets, Iran, U.S. Global Hegemony - 15th July 19
U.S Bond Yields Point to a 40% Rise in SPX - 15th July 19
Corporate Earnings may Surprise the Stock Market – Watch Out! - 15th July 19
Stock Market Interest Rate Cut Prevails - 15th July 19
Dow Stock Market Trend Forecast Current State July 2019 Video - 15th July 19
Why Summer is the Best Time to be in the Entertainment Industry - 15th July 19
Mid-August Is A Critical Turning Point For US Stocks - 14th July 19
Fed’s Recessionary Indicators and Gold - 14th July 19
The Problem with Keynesian Economics - 14th July 19
Stocks Market Investors Worried About the Fed? Don't Be -- Here's Why - 13th July 19
Could Gold Launch Into A Parabolic Upside Rally? - 13th July 19
Stock Market SPX and Dow in BREAKOUT but this is the worrying part - 13th July 19
Key Stage 2 SATS Tests Results Grades and Scores GDS, EXS, WTS Explained - 13th July 19
INTEL Stock Investing in Qubits and AI Neural Network Processors - Video - 12th July 19
Gold Price Selloff Risk High - 12th July 19
State of the US Economy as Laffer Gets Laughable - 12th July 19
Dow Stock Market Trend Forecast Current State - 12th July 19
Stock Market Major Index Top In 3 to 5 Weeks? - 11th July 19
Platinum Price vs Gold Price - 11th July 19
What This Centi-Billionaire Fashion Magnate Can Teach You About Investing - 11th July 19
Stock Market Fundamentals are Weakening: 3000 on SPX Means Nothing - 11th July 19
This Tobacco Stock Is a Big Winner from E-Cigarette Bans - 11th July 19
Investing in Life Extending Pharma Stocks - 11th July 19
How to Pay for It All: An Option the Presidential Candidates Missed - 11th July 19
Mining Stocks Flash Powerful Signal for Gold and Silver Markets - 11th July 19
5 Surefire Ways to Get More Viewers for Your Video Series - 11th July 19

Market Oracle FREE Newsletter

Top AI Stocks Investing to Profit from the Machine Intelligence Mega-trend

Gold and South African Gold Miners Tumble on Rising Costs

Commodities / Gold & Silver Aug 01, 2008 - 09:19 AM GMT

By: Adrian_Ash

Commodities THE SPOT PRICE OF GOLD fell into the New York open on Friday, beginning August almost 4.5% below July's start despite news that US unemployment just rose to a four-year high.

"Everything is down this morning as margin calls bite," says Mitsui in its Gold Market note today – "equities, the Euro, the oil price and precious metals.


" Gold should find short-term support at Wednesday's lows [$894/oz] but it is looking more and more likely that the market wants to test the longer term support at $890."

Following an AM Fix here in London of $909.50 per ounce, physical Gold slipped 0.7% to bounce off $902.80 despite news that US unemployment rose to a four-year high of 5.7% in July.

Last month saw non-farm payrolls cut by 51,000 – but that was smaller than analyst forecasts of 75,000 job losses.

After data showing German retail sales fell 1.4% month-on-month in June, the Euro sank to a five-week low of $1.5515 on the US jobs data.

Europe-wide, the PMI Manufacturing survey for last month showed a marked deterioration in confidence.

The Gold Price in Euros today held just 1.7% below its level of 1st July.

Crude oil today dipped below $123 per barrel, helping to pull the major commodity-price indexes lower.

"I would say Gold has got potential upside from where it is now," said Nick Holland, CEO of South African gold-miner GoldFields to CNN today.

"It is a safe haven because of the issues going on with the US economy, but also around the world. We're starting to see negative real interest rates creep in, and that's always a good sign for Gold ." ( Find out why Gold Rises When Real Returns to Cash Tumble in this free report... )

After a raft of corporate earnings already this week, all pointing to Higher Costs for Gold Miners , Gold Fields today reported a 32% drop in quarterly profits, sending the stock to a three-year low on the Johannesburg Stock Exchange.

Cash-costs per ounce rose 27% to $470 for the world's fourth-largest Gold Miner . Expenditure on GoldFields Cerro Corona gold & copper mine in Peru – located some 4km up in the Andes – will have to rise from $450 million to $550m because of "costs overruns, delays, new contractor claims and under-estimation of costs that we had not projected before," according to Holland.

The JSE's gold mining index today tumbled almost 5% in what one equity trader called "a miserable market – but most of the miserliness is confined to the resource stocks."

On the broader stock markets, meantime, European equities shed 0.4% on average while US stock-market futures pointed sharply lower after General Motors – formerly the world's No.1 auto-maker – reported its third greatest loss ever at $15.5 billion for April to June.

Revenue fell 18% from the same period in 2007. The losses included $3.3bn in redundancy checks for 19,000 workers who left in June, plus $1.3bn of write-offs at GMAC Financial Services – most notably on bad loans to buyers of trucks and SUVs.

Earlier on Friday in Tokyo , Japan 's third-largest car-maker – Nissan – reported a 43% drop in second-quarter earnings.

Top luxury car-maker BMW said in Frankfurt , Germany this morning that its Q2 profits fell 33%, blamed on a collapse in US sales forced by the strong Euro currency.

On the other side of the trade, meantime, French energy giant Total – the world's fourth-largest oil & gas producer – reported a rise of 39% in its quarterly profits.

"There is not a huge amount of Gold Buying," said an Indian bank dealer to Reuters today.

"People are spreading it across several levels."

This week's break below $900 per ounce in the international Gold Price met a flood of buying in India – destination for one ounce in every five sold worldwide last year.

Today the price of Gold held above 12,600 Rupees per 10 grams. The heaviest Gold Buying Season is due to start once India 's harvest ends in mid-Sept., culminating with Diwali – "festival of lights" – in October.

By Adrian Ash
BullionVault.com

Gold price chart, no delay | Free Report: 5 Myths of the Gold Market
City correspondent for The Daily Reckoning in London and a regular contributor to MoneyWeek magazine, Adrian Ash is the editor of Gold News and head of research at www.BullionVault.com , giving you direct access to investment gold, vaulted in Zurich , on $3 spreads and 0.8% dealing fees.

(c) BullionVault 2008

Please Note: This article is to inform your thinking, not lead it. Only you can decide the best place for your money, and any decision you make will put your money at risk. Information or data included here may have already been overtaken by events – and must be verified elsewhere – should you choose to act on it.

Adrian Ash Archive

© 2005-2019 http://www.MarketOracle.co.uk - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.


Post Comment

Only logged in users are allowed to post comments. Register/ Log in

6 Critical Money Making Rules