Gold Prices Get An Adrenaline Shot At The Start Of The Week
The financial situation in the market right now could bode quite well for the strength of gold. This week the Federal Reserve took major action to insulate the economy from any fall-out resulting from the coronavirus outbreak. This includes buying assets “in the amounts needed to support smooth market functioning and effective transmission of monetary policy to broader financial conditions and the economy.”
The Fed will also buy agency commercial mortgage-backed securities as a portion of the expansion of its asset purchases. Known as quantitative easing or “QE” the move essentially offers a blank check during this time of the economic strain. There’s still quite a bit of uncertainty right now.
Top Gold Stocks to Watch
While the market likes some semblance of order, the unknown has been a big proponent of the downside risk we’ve seen recently. “Aggressive efforts must be taken across the public and private sectors to limit the losses to jobs and incomes and to promote a swift recovery once the disruptions abate,” said the Fed in a statement.
Though the move wasn’t immediately reflected in the market, by mid-morning, the direction became clear. Gold prices and gold stocks began to climb. The price of gold reached highs of over $1,545 before the lunch hour. Meanwhile, some of the top gold ETF’s like the SPDR Gold Trust (GLD ETF Report), VanEck Gold Miners ETF (GDX ETF Report) and even the VanEck Junior Gold ETF (GDXJ ETF Report) all pushed higher on March 23. As oil prices continue to slide, the upside for gold companies grows from a fundamental perspective.
The energy demand for mining operations isn’t going anywhere anytime soon so this could be a big benefit for miners’ bottom lines. In light of these developments, a new, healthy climate may be forming for gold. With this in mind, it doesn’t hurt to have a strong list of top gold stocks to watch right now.
Top Gold Stocks: IMC International Mining
When you talk about junior gold stocks, you can’t ignore the few that have weathered this latest storm incredibly well. This is in reference to the pullback that many gold stocks have seen recently. IMC International Mining (IMIMF Stock Report) (IMCX) hasn’t faltered during the latest bout of sector sell-off. You can confirm this by looking at any stock chart of IMC compared to the price of gold. We did this in our weekend article about some of the best gold stocks to watch this month.
On March 23) the company conducted an important conference call. Incoming Chairman Greg Hawkins discussed the recently announced signing of a definitive agreement to acquire Thane Minerals. Earlier this month the company announced its next step in its latest acquisition plans. Thane Minerals will bring on a new asset; the Cathedral Property.
The reason why this call was important is twofold. Not only did the public get to hear for themselves, the stance of Greg Hawkins on IMC’s latest endeavor, but it also gave direct insight from an industry vet who’s been involved in the space since 1969.
Top Gold Stocks: Yamana Gold
Yamana Gold stock (AUY Stock Report) has been another top gold stock to watch this week. Overall, shares remain higher than its 2020 lows by about 30%. However, last week was another wild week for the stock. Shares managed to reach highs of $3.65 and broke above its 200-day moving average. This was a pivotal level previously for Yamana gold stock. It marked a level of support/resistance when shares started jumping late last year.
Last week the stock declined after its last update. Yamana reported that it would partially demobilize its workforce in Argentina. But the company also said it will “continue to work with a limited workforce” nonetheless. In addition, Yamana will “gradually reduce ” its activities at the company’s Agua Rica project “on a temporary basis”.
“Between today and March 31, the day the mandatory self-isolation period is scheduled to end, the Company will demobilize local employees and contractors at Cerro Moro and continue to work with a limited workforce comprised of employees and contractors primarily from out of province. Underground operations will be reduced and Cerro Moro will operate during this period largely from its open-pit operations and from stockpiled material. The Company plans to maintain operations at the plant during this period consistent with the Company’s normal and national safety and health protocols,” stated the company.
Top Penny Stocks: Barrick Gold
Barrick Gold (GOLD Stock Report) is on the higher end of the price range among this list of gold stocks. In line with the price of gold, Barrick gold stock rose on March 23. It reached a high of $17.87 just before the lunch hour. The company continues to keep an open line of communication with the public regarding COVID-19 risks.
Last week Barrick reported response plans throughout its organization. “We have taken measures to support the sustainability of the business. As shared in our March 6 release, we have increased stock levels for key supplies and equipment to a minimum of three months, identified alternative suppliers and shipping routes, and put in place contingency plans for clearing and offloading. To date, placed and forecast orders are still intact and there have been no hold-ups in our supply chain,” said CEO Mark Bristow.
As quantitative easing continues to flow, the bullish case for gold continues to grow. Meanwhile, questions on the future of the U.S. dollar arise as the government is sett to pump trillions of new money into the market. While Barrick has tested its 200-day moving average yet again on Monday, will this firmly mark the new leg of gold’s bull run.
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