Gold stocks surge as global prices rise more than 1%
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The news: Gold miners were among the best performing stocks on the ASX today as bullion prices lifted by more than 1% to the highest level since 2 August.
The numbers: Spot gold rose 1.5% to USD2,468.25 ($3,741.25) per ounce overnight, according to Reuters, before lowering to USD2,464.52 by 2:45pm AEST.
ASX gold stocks De Grey Mining (7.8%), Genesis Minerals (7.4%), Ramelius Resources (6.3%), Red 5 (4.3%) and West African Resources (4.9%) all made significant gains and made up half of the top 10 performing stocks across the ASX 200, as the materials sector added 0.44%.
The context: Gold bullion prices were driven higher by safe-haven demand flowing from increased tensions in the Middle East and between Russia and Ukraine. Israeli forces continued operations near the southern Gaza city of Khan Younis on Monday, while Russian President Vladimir Putin criticised Ukraine's recent incursion into the Kursk region.
Traders also await US inflation data this week that might provide more clues on the Federal Reserve's interest rate cut path, with US producer prices data and consumer prices numbers also expected to provide more clarity.
Bullion is considered a hedge against geopolitical and economic uncertainties and tends to thrive in a low interest rate environment.
The source: Reuters
