Gold Stocks Shine, GDX Eyes Best Day Since 2009

GOLD STOCKS NEWS – Gold stocks soared alongside the price of gold on Friday following the latest worrisome report on the state of the U.S. economy.  The Market Vectors Gold Miners ETF (GDX), the world’s largest gold stocks ETF, climbed as much as $3.00, or 6.9%, to $46.78 per share in mid-day trading.  Gold stocks in Canada jumped in conjunction with the GDX, as the S&P/TSX Global Gold Index added 7.0% to 327.13.

COMEX gold futures advanced to as high as $1,619.30 per ounce amid safe-haven buying and modest weakness in the U.S. dollar after the May non-farm payrolls report came in far below economists estimates.  The unemployment rate also ticked up to 8.2%, while the prior two months of job growth were revised lower.

With today’s rally in gold stocks, the GDX is within a fraction of surpassing its best day since November 30, 2011 – when it advanced 7.0% to $60.41 per share.  If the GDX is able to eclipse that mark, the gold stocks ETF would next have its sights set on the 7.7% gain it delivered on November 3, 2009.

The Market Vectors Junior Gold Miners ETF – a basket of small- and mid-cap gold stocks – fared even better than the GDX on Friday, with a 7.1% climb to $20.69 per share.

Since reaching a multi-year low of $39.08 on May 16th, the GDX has now surged 19.7%.  However, as an indication of the severity of the sector’s weakness prior to the past two weeks, the gold stocks ETF remains lower by 9.0% on a year-to-date basis.

Notable gold stocks moving higher in mid-day trading included Barrick Gold (ABX), the world’s largest gold mining company, which rallied $2.81, or 7.2%, to $41.87 per share.  Goldcorp (GG), the sector’s second largest component by market capitalization, rose $3.61, or 10.0%, to $39.84 per share.