Gold regained some of its lost glitter Thursday, a move that is being attributed to short covering amid tensions in Iraq and expectations of more stock market volatility.
As traders bought into gold, August bullion was up $41.40 to US$1,314.10, marking its best day in eight months. July Comex silver rose $1,062 to $20.84.
Andrew Pyle, senior wealth adviser with Scotia McLeod in Peterborough, Ont., told The Canadian Press that traders are moving into precious metals as many expect continued volatility in the stock markets going into the summer due to fighting in eastern Ukraine between pro-Russian insurgents and government forces and the situation in Iraq.
The Market Vectors Gold Miners ETF (NYSE: GDX, Stock Forum), which holds a basket of the world’s top gold stocks, rose 5.4% to $26.09.
Among gold sector stocks, Barrick Gold Corp. (TSX: T.ABX, Stock Forum), the world's leading producer, jumped 3.3% to $19.50.
Goldcorp. (TSX: T.G, Stock Forum) gained 4.8% to finish at $29.65.
B2Gold Corp. (TSX: T.BTO, Stock Forum) was among the most active stocks on the TSX, rising 7.7% to $3.09 on volume of 26.3 million shares.
Eldorado Gold Corp. (TSX: T.ELD, Stock Forum) jumped 8.5% to $7.68 after six million shares changed hands.
As gold rallied, investors also assessed Wednesday’s statement from the U.S. Federal Reserve Board, which hinted that the central bank wasn’t too worried about inflation, but gave no signs on when it might start raising interest rates.
Meanwhile, African Barrick Gold, the Tanzania-focused subsidiary of Barrick Gold, on Thursday dismissed accusations of illegal payments made to Tanzanian officials, where it operates the North Mara mine, according to a report by Reuters news service.
“Both African Barrick Gold and Barrick Gold Corp. are committed to ethical and transparent business practices in compliance with the law,’’ African Barrick said in response to Wall Street Journal article that reported accusations that the gold miner had paid $400,000 in cash to bribe Tanzanian government officials and consultants responsible for valuing the land.
Barrick said it provides “modest financial support” to government officials taking part in valuing land that it might wish to acquire, in line with standard rates provided by the government.
“Cash is often the only viable method of payment because in many regions of the country, banking infrastructure and services are extremely limited, or sometimes not available at all,’’ it said.
Read more at http://www.stockhouse.com/news/natural-resources/2014/06/19/investors-pour-into-gold-as-barrick-t-abx-denies-bribery-allegations-africa#rLTL2QEoH3TRAwuF.99