Gold stocks lead ASX as prices lift
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The news: Gold miners surged on the ASX as spot gold prices moved higher, while investors await US economic data that might impact a decision on cutting interests rates by the Federal Reserve.
The numbers: Gold stocks made up eight of the top 10 performers across the ASX 200 by 1:10pm AEST in a flat market.
Emerald Resources (6.7%), Red 5 (6.4%), West African Resources (4.6%), Bellevue Gold (3.9%), Ramelius Resources (3.4%), Genesis Minerals (3.3%), Evolution Mining (3.3%) and Gold Road Resources (2.8%) all made gains. Materials was the best performing sector, up 0.33%.
Spot gold was trading 0.23% higher at USD2,415.15 ($3,658.68), according to Bloomberg data. Bullion prices rose to an all-time high of USD2,483.60 last week amid heightened expectations of US rate cuts.
The context: Investors will look to key US data releases this week to offer more clues about the Federal Reserve's rate-cut timeline. The second-quarter gross domestic product reading is due on Thursday and the June personal consumption expenditures (PCE) price index — the Fed's preferred inflation gauge — figure is expected on Friday.
What they said: "If either the GDP or core PCE figures produce an upside beat, this could provide a stumbling block for gold in the short term on dollar strength," KCM Trade's chief market analyst Tim Waterer told Reuters.
"... [But] the near-term outlook for gold remains constructive from a fundamental point of view, given that the Fed appears to be on the doorstep of a rate cut," he said.
The source: Reuters
