It has been a bullish quarter, at long last, for gold (NYSE: GLD) and silver (NYSE: SLV).
The exchange traded fund for gold, SPDR Gold Shares, is up for the last week, month, and quarter of market action. It is the much the same story for the exchange traded fund for silver, iShares Silver Trust. There is also a bullish outlook for publicly traded companies in the sector such as Barrick Gold (NYSE: ABX), Wishbone Gold PLC (PINK: WISHY), and Goldcorp (NYSE: GG).
In an interview on this site with Richard Fulden, the Executive Chairman of Wishbone Gold PLC, it was stated that, "India and China are the largest gold buyers worldwide. There has been a recent move away from derivative gold products (such as Exchange Traded Funds) and a move into directly holding the metal. Industrial demand only accounts for about 3% of world purchases so the major buyers of gold are doing so for investment."
The recent economic news from China is thus very bullish for Wishbone Gold PLC and others.
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What makes Wishbone Gold PLC so appealing is its holdings in Australia. China and Australia have a long standing trading relationship for natural resources, ranging from coal to gold and silver. Even more bullish for Wishbone Gold PLC was the analyst recommendation from Beaufort Securities.
Barron's recently ran a very bullish article on Barrick Gold PLC. The earnings report from Goldcorp just beat estimates. As a result, Goldcorp and Barrick Gold PLC have done very well in recent market action. Being the two largest companies in the sector, that is very positive for the other firms.
This should continue as Fulden noted in the interview that central banks in China and India were buying gold. WIth the economies improving, consumers will no doubt buy gold, too. That is very bullish news for across the gold and silver sector, ranging from a small cap like Wishbone Gold PLC to exchange traded funds like SPDR Gold Shares and iShares Silver Trust.
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