6 Gold Mining Stocks To Buy As Gold Dips Post Prez Debate

Gold lost its ground on Tuesday, as both the greenback and equity markets firmed, following the first Presidential debate and stronger-than-expected economic reports. Markets viewed that Democratic candidate Hillary Clinton outshone rival Donald Trump, thus denting the safe-haven appeal of bullion and bonds. Gold snapped its six-day winning streak with spot gold down 0.7% to $1,326.91 an ounce.

Meanwhile, the U.S. consumers’ confidence unexpectedly jumped in September, to attain its highest level since the recession. The index increased to 104.1 this month from 101.8 in August, much higher than analysts’ expectation of a reading of 99. The survey is a closely followed barometer of consumer attitudes, measures confidence toward business conditions, short-term outlook, personal finances and jobs.

This upbeat number signals that American households could continue to support economic growth in the U.S. Household spending accounts for the majority of U.S. economic activity. Healthy growth in consumer outlays supported the economy’s growth at a modest pace in second-quarter 2016, despite headwinds such as reduced business investments and lower government expenditures.

Markets Jump while Safe-Haven Metals Dip

Stocks are benefitting on the prospect of a Clinton presidency as investors are unsure of what a Trump presidency might mean for U.S. foreign policy, trade and the domestic economy. As of Tuesday close, the Dow Jones Industrial Average gained 133.47 points (0.74%) to close at 18,228.30 and the S&P 500 went up 13.83 points (0.64%) to 2,159.93. The tech-laden Nasdaq Composite Index closed at 5,305.71, gaining 0.92%. The dollar index, which weighs the greenback against a basket of currencies, was up 0.19% at 95.35.

It is a well known fact that there is an inverse relationship between the U.S. dollar and the price of gold. Gold prices for December delivery on the Comex division of the New York Mercantile Exchange closed 1% lower at $1,330.40 a troy ounce yesterday. Among other precious metals, silver fell 2.2% to $19.165 an ounce.

Gold Still Has Shine

The dip notwithstanding, prices of the yellow metal are up roughly 23% year to date. Gold has been enjoying a solid run in 2016 after three lackluster years. The Brexit-induced chaos in the global markets has spurred investors’ demand for gold. The deferral of U.S. interest rate hikes has been another major factor that has helped gold regain its shine this year.

A low-rate environment augurs well for the yellow metal. Concerns about global economic growth, along with lingering economic and political uncertainties, are likely to act in favor of gold in the near to medium term. Further, gold prices are generally helped by retail demand in countries like India and China, with the wedding and festival seasons occurring in the second half of the year.

MINING-GOLD Industry Price Index


MINING-GOLD Industry Price Index

Another factor that will eventually be a tailwind for gold is the supply of the precious metal having already attained peak levels as per reports. Global production of gold is likely to decline by 3% in 2016, thus ending a seven-year stint of rising output. Lower mined outputs forming the gold supply could help prices move north.

Grab These Glittering Stocks

Therefore, prospects for gold miners continue to remain bright. We have, thus, highlighted a few gold stocks that are good buys right now, backed by a strong Zacks Rank and upward estimate revisions and price gains till date.

Newmont Mining Corp. (NEM - Free Report)

Colorado-based Newmont is engaged in the exploration and production of gold, and the acquisition and development of gold properties worldwide. The company carries a Zacks Rank #1 (Strong Buy) and has gained roughly 113.9% year to date. Its estimates have moved up 15% over the past 60 days. The company has a projectedearnings growth of 91.3% for the current year.

New Gold, Inc. (NGD - Free Report)

Vancouver, Canada-based New Gold is engaged in the acquisition, exploration, development, and operation of mineral properties. It primarily explores for gold, silver and copper deposits.

New Gold has a Zacks Rank #1 and has racked up a roughly 94.83% gain so far this year. The company has expected earnings growth of around 491.7% for the current year. The Zacks Consensus Estimate for 2016 has moved up 60% over the last 30 days.

AngloGold Ashanti Ltd. (AU - Free Report)

Headquartered in Johannesburg, South Africa, AngloGold Ashanti operates as a gold mining and exploration company. AngloGold Ashanti – which sports a Zacks Rank #2 (Buy) – has gained roughly 127.75% year to date.  

The Zacks Consensus Estimate for 2016 has moved up around 19% over the last 30 days. The stock has an impressive expected earnings growth of 440% for the current year.

IAMGOLD Corp. (IAG - Free Report)

Toronto-based IAMGOLD is engaged in the exploration, development and operation of gold mining properties and also explores for copper and silver. IAMGOLD holds a Zacks Rank #2 and has gained roughly 188.73% year to date. The Zacks Consensus Estimate for 2016 has gone up over the past 60 days to 5 cents, an improvement from the loss of 43 cents per share in the prior year.

Gold Fields Ltd. (GFI - Free Report)

Based in Sandton, South Africa, Gold Fields is an unhedged, globally diversified producer of gold with eight operating mines in Australia, Ghana, Peru and South Africa. This Zacks Rank #2 stock has gained roughly 76.89% year to date. The Zacks Consensus Estimate for 2016 has moved up around 14% over the last 30 days. The stock has an impressive expected earnings growth of 600% for the current year.

Acacia Mining plc (ABGLF - Free Report)

Acacia Mining plc, together with its subsidiaries, mines, processes, and sells gold in Africa. The company also produces co-products, such as copper and silver.

The stock, which carries a Zacks Rank #2, has surged 133.96% year to date. For 2016, the Zacks Consensus Estimate is 32 cents, a huge improvement from 2 cents per share in the prior year. Estimates have moved north 23% over the past 60 days.

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