Gold stocks jump 19% as they ride out market storm

Login

Register

http://www.clubofmozambique.com/

Gold stocks jump 19% as they ride out market storm

11:16 CAT | 24 Jun 2016

Gold stocks rode out the market storm on Friday morning as Britain bowed out of the European Union in a disruptive affair that has claimed the country’s prime minister, David Cameron.

The gold miners’ index surged as much as 19% to its best level since November 2012 as investors jumped out of risky assets into the relative safe-haven of gold.

Spot gold was firmly back above the $1,300 per ounce mark, a move that appeared unlikely in the days leading up to the UK vote, which leaned towards the country staying in the 28-country bloc.

Another shot in the arm for gold miners came from the much weaker rand, which bore the brunt of the global risk aversion.

“What now? Possibly nothing. Having decided to leave the EU, the UK now needs to negotiate its exit. This might well take the rest of the decade or more and nothing legally changes in the interim,” Rand Merchant Bank analyst John Cairns said.

“The best-case scenario then is that everyone keeps calm and carries on, and markets quickly stabilise and recover most of their lost ground.”

With 100% of voting areas having now been counted, the “leave” camp took almost 52% of the vote, an outcome that forced Cameron to resign.

AngloGold Ashanti jumped 15% to R267.54, with Gold Fields rallying 16.66% to R70.80 and Sibanye adding 16.58% to R50.90.

Source: Business Day Live