Gold stocks under pressure

The overall market trend on U.S. markets was down over the report period Jan. 17-24, with both the Dow Jones Industrial Average and the broad-based Standard & Poor’s 500 index losing ground. DJIA shed 273.83 points to close at 10,686.04, while the S&P 500 lost 23.79 points to close at 1,263.82. While gold stocks came under some pressure, energy and coal stocks made gains, and diversified miners dodged the downdraft.

Rio Tinto was the week’s biggest value gainer, up US$8.73 to US$205.42. The diversified mining giant has been an investor’s darling for much of the past year, and it seems the party isn’t over.

With gold prices rising and falling like the tides, it’s no surprise that the share prices of most producers are being tossed around. Newmont Mining, the most active issue over the report period, shed US$2.66 to close at US$57.21, while Barrick Gold was up US8 to US$29.85. Royalty company Royal Gold lost US$2.11 to US$37.05 as investors began to worry if prices had peaked, or would continue to rise, as some gold bulls suggest.

Silver producer Coeur d’Alene Mines dropped US18 to US$4.21, reflecting the metal’s symbiotic relationship with gold.

One of the few gold companies to post gains was African-based miner AngloGold Ashanti, which pulled ahead US$1.56 to close at US$56.98.

Freeport McMoRan Copper & Gold dropped US$2.45 to US$58.30 after making steady gains over the past year. The company produces copper and gold at its vast Grasberg mine in Irian Jaya, Indonesia.

Copper miner Phelps Dodge slipped US$1.24 to US$143.35, but is holding strong, relative to its high-low range of US$55.69 and US$25.91 just five years ago.

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