Gold Digger: Gold a standout performer in 2020, and there’s more to come
Gold has outperformed most major asset classes this year including all major US stock indexes to be up by more than 15 per cent, according to the World Gold Council.
Despite the seemingly bullish environment for risk assets in May — global stocks collectively rose by 6 per cent — the gold price edged higher while the holdings of gold-backed ETFs hit record highs.
“As investors look to hedge the economic risks of ballooning budget deficits and high valuations for both stocks and bonds, collective holdings of gold ETFs have now surpassed Germany’s official gold reserves and exceed the official gold reserves of every country except for the US,” it said.
“This also highlights the increasing acceptance of gold ETFs among investors as a means to gain exposure to gold.”
#Gold has not only provided a hedge, it has outperformed all major US stock indexes. Even #silver beaten the #Dow and S&P 500. Gold also outperformed real estate, US #dollar, and even Treasuries. Through May,, gold has risen more than all major asset classes. #equities #invest pic.twitter.com/uHx5M5qZqP
— Gavin Wendt (@MineLifeReport) June 5, 2020
Many of the positive gold demand drivers remain in place, says the World Gold Council.
That includes low interest rates, lingering uncertainty around the economic and social impact of COVID-19 (including a second wave of infections), escalating tensions between the US and China, and challenges in labour markets “not seen in generations”.
Furthermore, the race-related civil unrest that has recently emerged in the US, will create “additional uncertainty” in markets, the council says.
Here’s how ASX-listed gold stocks performed for the period June 01–05 [intraday]:
Scroll or swipe to reveal table. Click headings to sort. Best viewed on a laptop:
Over the past year, 39 of the companies on our list have made gains of 100 per cent or more. The major miners have been impressive, led by Silver Lake Resources (ASX:SLR) +132%, Perseus Mining (ASX:PRU) +156%, and West African Resources (ASX:WAF) +195%. Just one major, Resolute Mining (ASX:RSG) -6%, is down over the past year.
METALICITY (ASX:MCT) +86%
Metalicity has just launched a new drilling program at its historic, high-grade Kookynie gold project in WA, focused on the previously mined Leipold and McTavish prospects.
But there’s also ~8km of ‘strike’ here – identified this week through mapping and re-processing of regional geophysics — without a drill hole in it.
The structures that host the high-grade Cosmopolitan mine, which produced 360,000oz at 15 grams pet tonne (g/t) gold in the early 1900s, are now thought to extend for ~2km north and south of the mine.
This highlights the ‘camp scale’ potential of the unloved project, Metalicity says, which had already established an exploration target of between 294,000oz and 967,000oz at Kookynie.
The latest round of drilling at Saturn’s flagship~780,000/oz Apollo Hill project has widened the mineralised corridor to 600m and extended the higher-grade hanging wall mineralisation.
Hits included 8m at 5.12g/t gold from 215m and 4m at 15.57g/t from 100m, including 2m at 31g/t from 100m.
Saturn’s plan is to increase the current resource with an update due out later this year.
TORIAN (ASX:TNR) +30%
Hole one of maiden drilling at the Mt Stirling gold camp in WA has hit 274m of quartz‐carbonate veining containing pyrite and ended in mineralisation, Torian (ASX:TNR) says.
Results are “imminent” from this eight-hole drill program — the first in four years — which is testing extensions to a significant historical gold intercept of 35m at 2.99g/t.
A much bigger phase-two drilling program is already planned at Mt Stirling, which neighbours $530m market cap RED 5’s (ASX:RED) King of The Hills mine.