No one mentioned this was coming. XAU Should take a Major hit today!! This major downdraft should NOT be seen as an indicator of future direction of gold price but MAY cause a sell off of the other Mining Stocks When XAU falls so hard!!
Your XAU - Gold Price ratio should make a major change!! & you're showing ABX & PDG being +14% of XAU so XAU hit could be MAJOR!!
S&P 500 changes to dominate
Sentiment remains weak as European stumbles
By Emily Church, CBS.MarketWatch.com
Last Update: 5:58 AM ET July 10, 2002
LONDON (CBS.MW) - Leading U.S. large caps were marked lower in pre-open trading on Wednesday as European stocks stumbled on a new wave of selling, but the bearish sentiment for once looks to take a backseat to a technical issue of stunning influence: the new S&P 500 index make-up.
Standard & Poor's decision to go all-American with its S&P 500 index of large stocks and add seven recent IPOs like Goldman Sachs and Electronic Arts to the No.1 market benchmark created a little havoc in Europe on Wednesday.
Royal Dutch Petroleum (RD: news, chart, profile) and Unilever (UN: news, chart, profile) were the two European companies among the seven that will be ousted from the S&P 500. The stocks promptly plunged 7 percent and were the leading large cap decliners on the Continent.
Merrill Lynch estimates $830 billion is indexed to the S&P 500. Any change brings the prospect of a massive increase in supply, and hence depressed stock prices, as fund managers sell the out-going and buy in the in-coming stocks.
The other five Canadian companies to go after the close on July 19 are Nortel (NT: news, chart, profile), Alcan (AL: news, chart, profile), Barrick Gold (ABX: news, chart, profile), Placer Dome (PDG: news, chart, profile), and Inco (N: news, chart, profile).
Coming in are: United Parcel Service (UPS: news, chart, profile), Goldman Sachs (GS: news, chart, profile), Ebay (EBAY: news, chart, profile), Electronic Arts (ERTS: news, chart, profile), Prudential (PRU: news, chart, profile), Principal Financial (PFG: news, chart, profile), and SunGard Data (SDS: news, chart, profile). Read about the rationale at S&P for the index change
Dealers at Madoff Securities in London said that Ebay was marked up 4 percent at $59.26. Among out-going stocks: Canadian gold stocks Barrick was down 60 cents at $18.95; Placer Dome was down 35 cents at $11.10 and Nortel Networks was down 10 cents at $1.45.
In other non-S&P related action, trend-setters like Cisco Systems (CSCO: news, chart, profile) and Intel Corp. (INTC: news, chart, profile) were marked down 5-25 cents. Dell Computer (DELL: news, chart, profile) was trading in line. |
