  Gold Futures hit $1,110 intraday high, Keegan Resources Surges 18%
Reported by Proactive Investors on Monday, 9 November 2009 (on November 9, 2009)
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The Gold prices have risen progressively throughout the morning in electronic trading, with futures approaching an intraday high of $1,110 earlier this morning, as the US Dollar continues to come under pressure. Throughout most of last week gold made substantial gains following a series of fundamental and forex related developments. On Wednesday gold continued to test new territory and hit yet another all time high of $1098/ounce. After months of continual gains the gold price now stands 23% higher than at the turn of the year. On Tuesday news that India had shelled out $6.7 billion to buy 200 tonnes of gold from the IMF sparked off speculation that none of the proposed 400 tonnes of gold up for sale by the IMF would actually hit the market, instead being snapped up by emerging economies keen to diversify their investments out of US dollars. Many commentators suggest that the IMF’s deal with India is significant for two key reasons. Firstly in a tangible sense, the directly agreed sale has alleviated downside pressures in the physical market. Some investors feared that such a sale on the open market could have sparked wider selling to challenge any further rally. Analysts have suggested the potential for a ‘bidding-war’ between developing central banks such as China and Russia for the remaining 200 tonnes of IMF gold-sale. Secondly market commentators have highlighted the symbolism of the purchase. Many suggest that it is yet another indication that the world’s emerging economies are losing faith in the US Dollar for their respective financial reserves. Over the past few months several reports have highlighted the growing scepticism over Dollar’s future role in the global economy. In September, reports suggested that certain oil producing states explored a move away from a Dollar pricing mechanism in the Crude Oil market. Similarly a number of Finance Ministers have been reported to have questioned the effectiveness of the Dollar as a global reserve currency. Some argue that the US Dollar and US Government Bonds are becoming less relevant to International institutions, both in the investment industry and the wider economic organisations. Undoubtedly the US Dollar’s role in the global economic structure has been under the microscope, however at such an early stage many feel as though the line between political posturing and the potential for real practical measures will remain blurred for some time.
In North America, gold stocks followed the yellow metal higher in a fairly buoyant equity market on Monday. Keegan Resources (AMEX: KGN) was by far the strongest performing gold stock today, as the share price surged 18%. Dual listed Eldorado Gold (TSX: ELD; AMEX:EGO) and IAM Gold (NYSE: IAG) followed advancing 8% and 9% respectively.
Nevsun Resources (AMEX: NSU) and Multi listed gold stock Centamin Egypt (LSE: CEY, ASX: CNT, TSX: CEE) were both fairly strong, rising over 5.5% each. Agnico Eagle (NYSE: AEM), New Gold (AMEX:NGD) and Canadian based Yamana Gold (NYSE: AUY, LSE: YAU) also advanced more than 5%.Ontario based Rubicon (AMEX: RBY) climbed 4.5%, while Barrick Gold (NYSE: ABX) and South American focused Exeter Resources (AMEX: XRA, TSX: XRC) gained 4% on Monday. International Gold miner Randgold Resources (NYSE: GOLD, LSE: RRS) rose 3%.In Toronto, Victoria Gold Corp (TSX-V) were particularly strong also, rising 6%, Timmins Gold (TSX-V: TMM) climbed 5.5% meanwhile Hawthorne Gold Corp (TSX: HGC) has had a quieter session so far, the British Colombia focused gold explorer was unchanged on the day.In the OTC market, low-cost emerging gold producer Gold Resource Corp (OTCBB: GORO) advanced 6.5% to trade at $9.59.
Links: Full news story
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