Part of an article dated 13/1/03 from Macquarie on the Egoli site :
Gold breaks USD$354/oz ... Highest level since October, 1999
Gold has smashed through strong resistance level of USD$340/oz to trade at its highest level since October 1999
Heavy fund buying in New York continues to absorb significant selling pressure
Softer US dollar appears to be the main driver of interest, with the backdrop of continuing concerns about equity markets and uncertainty about possible US military action towards Iraq. Market rumours in New York were that Iraq has sold a chemical weapons to Islamic extremists with links to al Qaeda. US Defence Secretary Donald Rumsfeld stated that there was no question that Iraq had weapons of mass destruction.
A higher trading range, plus the evidence of more aggressive fund interest in gold will clearly be very positive for gold equities
Impact on Equities:
Preferred large exposure: Newcrest (outperform/outperform)
1. Financing of Telfer imminent 2. Restructure of hedge book to result in higher earnings contributions from Telfer. 3. Globally one of the few larger golds with strong production growth, large reserve base and low cash costs. 4. Corporate appeal remains. 5. Gold is up over 8.0% in the last month, with NCM up only about 1.5%. This gap may start to close.
Full article on: http://www.egoli.com.au/egoli_frame.asp? Frame=Warrants&File=4324
Have a good day.
(Please do your own research)
NCM Price at posting:
0.0¢ Sentiment: None Disclosure: Held
