WEEKLY GOLDEN TIDBITS

Top Five Market Moments

Newmont Corporation Acquires Newcrest Mining: Newmont Corporation (NYSE: NEM, TSX: NGT, ASX: NEM, PNGX: NEM) completed the acquisition of Newcrest Mining Limited, creating the world’s leading gold company with substantial copper production. This transaction is seen as a historic milestone in the mining industry, significantly strengthening Newmont’s position. The combined company now features over half of the world’s Tier 1 assets, expecting to generate annual pre-tax synergies of $500 million within the first 24 months. This acquisition includes 10 Tier 1 operations and is expected to support decades of safe, profitable, and responsible gold and copper production​​​​.

Evolution Mining Secures Option in Ontario: Evolution Mining, another prominent player in the ASX gold mining sector, has secured an option from Northern Superior Resources to purchase a 75% undivided stake in the latter’s October gold project located in Ontario, Canada. This move represents a strategic expansion of Evolution Mining’s portfolio into North American gold mining territory​​.

De Grey Mining’s Continued Growth: De Grey Mining (ASX:DEG) has matured into a significant player with a market cap of $2.2 billion. The company is developing its 6Moz Hemi’s gold Ore Reserve in the Pilbara. With plans to process 10Mt of ore per annum to produce 553 Koz of gold annually, De Grey has demonstrated extensive exploration potential along over 60km of mineralized trend in its Pilbara tenements. The project, which offers excellent infrastructure access, targets first gold by the second half of 2026​​.

Peregrine Gold’s Progress in Newman: Peregrine Gold (ASX:PGD) has been actively drilling at its Newman gold permits, located 25km west of Newman. The company has outlined lithium-bearing pegmatites in the Pilgangoora North permit and has acquired geophysical surveys in the Mallina area. Some of the significant drill intercepts indicate the potential for open-pit mining, with highlights including grades up to 62.8 ounces per tonne at the Peninsula Prospect​​.

Northern Star Resources’ Growth Outlook: Northern Star Resources, the second-largest gold miner on the ASX, has continued its growth trajectory. The company’s share price has increased by 25.85% year over year, with a solid dividend history. Northern Star operates major gold mines in Australia and North America and has several development projects underway. The company’s production outlook for FY 2024 is projected between 1.60 and 1.75 million ounces, an increase from the FY 2023 production of 1.56 million ounces. This growth is partly driven by rising gold prices, supported by strong buying from central banks​​​​.

Commodities Corner: Gold Recap

Early Week Decline and Recovery Hopes: Gold prices started the week lower, declining by 1% to a two-week low on Tuesday due to a firmer dollar, which made gold more expensive for overseas buyers. This fall was attributed to market positioning for interest rate cues from various Federal Reserve speakers. The drop in gold prices occurred despite gains of more than 7% in October, driven by the conflict in the Middle East which had boosted safe-haven demand. As the week progressed, there was anticipation for dovish signals from the U.S. central bank, which could potentially revive the gold rally​​​​​​.

Impact of Federal Reserve Speeches: Jerome Powell’s speech, particularly his more hawkish stance than expected, impacted the gold market significantly. Before his speech, gold prices rallied on Thursday morning, reaching $1965/oz, as the market expected dovish tones similar to the previous Fed meeting. However, Powell’s hawkish remarks, which indicated that the central bank was not confident about controlling inflation yet, led to a reversal of these gains. This resulted in gold prices declining to around $1955 by the close of the New York market on Thursday​​​​.

Gold’s Performance Relative to Other Assets: Throughout the week, gold’s performance was influenced by the broader financial markets. The initial decline in gold prices on Monday was attributed to an increase in risk appetite among investors, which was heightened by expectations of an end to the Fed’s current hiking cycle. This shift in risk appetite was further evidenced by gains in world shares and other assets like S&P 500 futures, hinting at a diversion of investment flows away from gold. Additionally, benchmark 10-year Treasury yields rose, further reducing the appeal of gold as an investment​​​​​​.

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