USAS - Precious Metals Weekly Round-Up: Gold Steady as US Dollar Dips

Gold prices steadied on Friday (April 12) thanks to dovish central banks and tumultuous stock markets placing pressure on the greenback.

This was a welcomed change for the yellow metal as it dipped close to 2 percent in the previous session. The metal is now headed for its first week of gains in three weeks.

“Even after the United States’ long-drawn-out trade spat with China and threats of a new trade war with the European Union, there is still not much safe haven buying in gold,” said Jigar Trivedi, a commodities analyst at Anand Rathi Shares & Stock Brokers.

“Gold has near-term support at US$1,285 [per ounce] and huge resistance at US$1,350,” Trivedi added.

Despite gold garnering some support from Chinese central bank buying and a dovish tone from major central banks, US economic data triggered the US dollar to rally, causing a sell-off in gold on Thursday (April 11) and taking down the key psychological US$1,300 level.

“Chinese demand, while remaining evident, did little to propel the yellow metal higher, rather providing an underlying level of support to restrict further declines,” MKS PAMP Group noted.

As of 8:47 a.m. EDT on Friday, gold was trading at US$1,291.50.

Meanwhile, silver steadied slightly on Friday but was down 0.3 percent for the week — its third straight weekly drop. As of 8:48 a.m. EDT, the white metal was trading at US$15.01 per ounce.

As for the other precious metals, platinum had yet another week of gains, climbing just over 1 percent and on track for its fifth straight weekly gain. 

The metal has beginning to rebound as investors seek it out since it’s currently cheaper than gold and palladium.

“It is encouraging to see investment demand for platinum growing rapidly in 2019, and we expect this trend to continue. We believe our ongoing efforts in product development through global partnerships, plus platinum’s discount to gold will support continued, solid retail investment in bars and coins,” said Paul Wilson, CEO of the World Platinum Investment Council..

As of 9:37 a.m. EDT, the metal was trading at US$898 per ounce.

For its part, palladium was down marginally and as of 9:40 a.m. EDT, the metal was trading at US$1,347 per ounce.

Precious metals top news stories

Our top precious metals stories this week include a look at the price of silver during the first quarter of 2019, a report from the World Gold Council on how global gold-backed exchange-traded funds (ETFs) fared during the month of March and a round-up of the current top 5 TSX-listed gold stocks.

1. Silver Price Update: Q1 2019 in Review

The silver price took some tumbles during the first quarter of the year. While it managed to hit a high of US$16.04 per ounce on January 30, it was down close to 2 percent over Q1.

Although a softer US dollar, geopolitical issues and a slow in economic growth helped the precious metal stay above some of the lows seen last year, silver was unable to make the same gains that its sister metal gold accomplished in Q1.

However, as the white metal heads into a new quarter, many industry insiders believe that silver is well positioned to climb and may even outperform the yellow metal.

2. Zimbabwe and Russia Unite in US$4 Billion Platinum Mine Deal

Zimbabwe and Russia have signed a US$4 billion agreement to build a new platinum mine in the African country.

The deal, which has been stalled since 2014, is for an asset owned by Great Dyke Investments, a company jointly owned by a Russian state-controlled company and Zimbabwe’s government.

“Two weeks ago we finalized the agreement and the Russians are ready to come on the ground,” said Polite Kambamura, Zimbabwe’s deputy mines minister, in an interview on the sidelines of a conference in Johannesburg.

3. Best Silver Stocks of 2019 on the TSX

While gold managed to rally from the lows seen throughout most of 2018, the yellow metal only saw slight gains, climbing just under 1 percent in the first quarter of 2019.

However, despite a slow rebound, many gold companies managed to make progress and increase earnings from their assets. Now that Q1 has come to a close, the Investing News Network has rounded up the best gold stocks on the TSX that have seen the biggest share price gains year-to-date.

The list below was generated on April 9, 2019 using TradingView’s stock screener. All companies listed had market caps above C$50 million at that time.

1. Wallbridge Mining Company (TSX:WM)

Current share price: C$0.43; year-to-date gain: 168.75 percent

2. Tanzanian Royalty Exploration (TSX:TNX)

Current share price: C$1.01; year-to-date gain: 110.42 percent

3. Eldorado Gold (TSX:ELD)

Current share price: C$6.19; year-to-date gain: 54.75 percent

4. Alacer Gold (TSX:ASR)

Current share price: C$3.62; year-to-date gain: 43.65 percent

5. Alamos Gold (TSX:AGI)

Current share price: C$6.80; year-to-date gain: 38.49 percent

Also in the news

Also making news this week, Sibanye-Stillwater (NYSE:SBGL,JSE:SGL) announced on Thursday (April 11) that it has further enhanced its liquidity position by concluding a forward gold sale arrangement with Citibank (NYSE:C).

The miner has received a cash prepayment of US$125 million in exchange for the delivery of 105,906 ounces of gold during the fourth quarter of 2019. Sibanye noted that the funding will be used for the repayment of revolving credit facilities.

Additionally, Newmont Mining (NYSE:NEM) announced that the company’s shareholders voted in to approve the acquisition of Goldcorp (TSX:G,NYSE:GG).

Newmont’s shareholders approving the deal was the final step of the transaction that is schedule to close this quarter. 

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Securities Disclosure: I, Nicole Rashotte, hold no direct investment interest in any company mentioned in this article.