On Thursday, the price of gold spiked higher after turmoil on world equity markets and global economic fears sparked a return to safe-haven buying.
Futures contracts in New York with December delivery dates jumped 2% to a high of $1,156 an ounce – gold’s best level in a month.
After weeks of lacklustre trade ahead of the US Federal Reserve interest rate decision, volumes on Comex shot up to twice the daily average on Thursday with just under 20 million ounces traded.
With fundamentals pointing to further upside potential for the metal, gold investors piled into mining stocks in massive volumes. The world’s top gold mining stocks gained steadily during the day and traded at their highs at the close on Thursday.
Barrick Gold Corp (NYSE:ABX, TSE:ABX) jumped 10.8% with more than 33 million shares changing hands, 12 million more than already high post-Fed interest. The counter was the sixth most actively traded stock on the New York Stock Exchange, attracting more buying interest than the likes of Ford Motor and Citigroup.
After falling to its its lowest since 1989 yesterday, today’s surge restores the world’s top producer of the metal’s market worth to $7 billion in New York. Barrick is still trading nearly 40% below its opening levels for the year as the Toronto-based company attempts to get rid of assets in a down market to tackle crippling debt.
Barrick’s gold production is expected to fall to between 6.1m – 6.4m ounces this year and the company announced last month that it has completed scenario planning to withstand a $900 an ounce gold price.
The world’s most valuable gold stock, Goldcorp (TSE:G, NYSE:GG) advanced nearly 7% lifting the company’s market capitalization back above $10 billion in New York after more than 11 million shares changed hands.
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