Precious metals bounced back from earlier losses to settle modestly in the black at the COMEX on Monday, despite a concurrent rebound in the U.S. dollar.
COMEX gold futures for August delivery finished up by $5.40, or 0.3%, at $1,596.80 per ounce following an intra-day low of $1,582.70 this morning. Silver futures inched higher by $0.11, or 0.4%, to $28.38 per ounce this afternoon after earlier sliding to $28.26 per ounce.
Gold and silver shares were buoyed by strength in the metals, but also faced a headwind in the form of weakness in the broader equity markets. The Philadelphia Gold & Silver Index (XAU) – made up of many of the world’s largest gold and silver mining companies – traded down by 0.5% at 161.28 this afternoon. The S&P 500 Index also headed south, by 0.6% to 1,318.38.
One notable gold miner in the news on Monday was Kinross Gold (K.TSX, NYSE: KGC), which reported the resumption of operations at its Tasiast mine in Mauritania, Africa. Following the announcement, National Bank Financial analyst Paolo Lostritto reiterated his Outperform rating and C$14.00 price target on K.TSX.
In his note to clients, Lostritto wrote that the “Shutdown was shorter than our initial 30-day estimate. Applying the shorter shutdown and accounting for a small ramp-up period, we now expect 2012 production of 2.56 million GEO (was 2.55 mln GEO) at TCC (total cash costs) of US$710/oz (was US$709/oz). Focus now returns to the processing decision at Tasiast expected to be released with Q2 results in early August.”
Shares of K.TSX rose fractionally this afternoon, by C$0.05 to C$8.56. Other advancers included Gold Fields (GFI) and Randgold Resources (GOLD) – which added 0.6% to $13.55 and 0.9% to $88.38 per share, respectively.
Among silver stocks, Pan American Silver (PAAS) was reiterated today with a Sector Outperform rating and $27.00 price target by Scotia Capital analyst Trevor Turnbull. In his report, Turnbull stated that “Pan American hosted an analyst day in Toronto last week. We were able to get project updates from Pan American’s full technical and financial team. After spending time with them, we consider them one of the most impressive we have met in the sector.”
Shares of PAAS nonetheless slipped 0.7% to $18.25 in afternoon trading. Other silver companies moving lower included Silver Standard Resources (SSRI) and Silver Wheaton (SLW) – which fell by 1.8% to $12.42 and by 1.1% to $27.20 per share, respectively.
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