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As if gold mining stocks aren't facing enough headwinds today (I, II), Credit Suisse downgrades...

As if gold mining stocks aren't facing enough headwinds today (I, II), Credit Suisse downgrades Barrick Gold (ABX -6.4%) to Neutral from Outperform with a $20 target, saying ABX needs to provide clarity on the path for Pascua and for handling asset sales and its financial leverage. Also downgraded to Neutral at CS: Silver Wheaton (SLW -5.3%), Pan American Silver (PAAS -1.9%).
Comments (9)
  • Whitehawk
    , contributor
    Comments (3129) | Send Message
     
    This sector is likely looking at consolidation. It is also an oppty for value-oriented investors to take some of these companies private. Of course, there is risk with the sector having nothing to do with gold pricing: many of the mines are in countries that pose questionable stability for mining contracts. Platinum, which is broken and in a bear market, is backed by a mining cartel, and even that doesn't mitigate some of the price risk.
    26 Jun 2013, 01:37 PM Reply Like
  • CraigPowell
    , contributor
    Comments (102) | Send Message
     
    Like all asset-price surges that are divorced from the fundamentals of supply and demand,the gold bubble is deflating.
    This gold direction to the south, was accurately predicted 9 months ago: http://tinyurl.com/pbg...
    26 Jun 2013, 02:04 PM Reply Like
  • TXFLYGUY
    , contributor
    Comments (45) | Send Message
     
    I should have listened. I now am riding the elevator all the way to the basement...
    26 Jun 2013, 02:47 PM Reply Like
  • Whitehawk
    , contributor
    Comments (3129) | Send Message
     
    The rise in gold and other PMs was predicated on a continued weakening of the dollar and inflation in the EMs. With the dollar strengthening and air coming out of EMs (that imported dollar inflation), dollar-linked commodities are declining or disinflating. Several of us on SA have predicted the declines - I've called $1200 gold and $18-19 silver for some time based on technicals and sentiment, and today it is reality in the paper markets.

     

    Today the equity markets are inflated, and especially on a day where we've been given the information of a GDP print 25% less than expected. The futures shot up many hours before the report. I'll let you decide if there is market manipulation or not.
    26 Jun 2013, 03:00 PM Reply Like
  • Chris Lau
    , contributor
    Comments (1794) | Send Message
     
    Whitehawk
    Do you also predict the proverbial "dead cat bounce" in gold and in silver at some point? Gold prices are now below the cost of production for these firms.

     

    Consolidation will happen but I doubt it will be among the big firms. The small ones might get taken out.
    26 Jun 2013, 06:44 PM Reply Like
  • investordd
    , contributor
    Comments (81) | Send Message
     
    At any given time the direction of gold is predicted to go in any given direction, so to say that it was accurately predicted 9 months ago because in hindsight it is accurately predicted every day.
    26 Jun 2013, 10:56 PM Reply Like
  • User 195396
    , contributor
    Comments (368) | Send Message
     
    the bad news=good news for continuation of QE forever=no taper.
    26 Jun 2013, 04:30 PM Reply Like
  • rbrodehl
    , contributor
    Comment (1) | Send Message
     
    I am steadily buying small amounts of slw, ng abx, etc. In hopes for the long run --2-4 years
    26 Jun 2013, 08:29 PM Reply Like
  • Sharplikecheddar
    , contributor
    Comments (88) | Send Message
     
    May I ask why NG?
    28 Jun 2013, 10:53 AM Reply Like
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