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Gold/Mining/Energy : At a bottom now for gold? -- Ignore unavailable to you. Want to Upgrade?

To: RonS who wrote (835)	10/27/1997 8:02:00 AM
From: Daytek77	Read Replies (1) \| Respond to of 1911

Ron, I don't know whether the media is reporting this erroneously because they is a concerted effort or this simply demonstrates the innacurate reporting of news in general. This excercise has left me with a healthy dose of skepticism from now on. I will not accept anything I hear until I can confirm it from several sources myself. I was reading comments from early trading in Australia and the reporting was even worse, they had "a Swiss bank selling 1400 tonnes". what a time we live in. Here is a story from Reuter's originating in Australia. They state that Switzerland may sell and later in the same article is says that they have approved a 1400 tonne sale, which is not true. Sunday October 26 7:27 PM EST Australia gold stocks slump after Swiss-led rout SYDNEY, Oct 27 (Reuters) - Australian gold stocks slumped more than nine percent in frantic early trade on Monday after the gold price fell five percent on Friday night to 12-year lows on news the Swiss central bank may sell 1,400 tonnes of gold. The Australian Gold index fell 117.7 points or 9.45 percent to 1,131.7 by 10.35 a.m. (2335 GMT). Stocks with largely unhedged production were hardest hit. Plutonic Resources, which is relatively lightly hedged, fell 36 cents or 11.4 percent to A$2.81, while the fully hedged Normandy Mining Ltd (NDY.AX) fell 5.7 percent or 10 cents to A$1.64. ''People look for the production being hedged as a way for these producers to preserve near-term earnings and the place to be is Normandy and Gwalia Consolidated (GWC.AX),'' said ABN AMRO Hoare Govett Head of Mining Research David Walker. He said these two companies had large volumes of production hedged at high values for the next two to three years. Gwalia Consolidated's shares were down five cents or 5.2 percent at 90 cents. ''It's the smaller hedging positions that are going to get hit. Plutonic is very lightly hedged,'' Walker said. Newcrest's (NCM.AX) shares were down 32 cents or 14 percent A$2.23. Plutonic is about 33 percent owned by Malaysia Mining Corp (MMCB.KL). The gold price slumped US$16.10 an ounce to US$309.60 on New York's Comex market on Friday, but had bounced to US$310.75 in early Asian trade. On Friday, officials of the Swiss finance ministry and the Swiss National Bank said they approved of a plan to sell up to 1,400 tonnes of Swiss gold reserves. Since March this year, the Swiss have debated a broad plan to overhaul their constitution to reduce the amount of gold needed to back the Swiss franc. Analysts said the Australian industry appeared set for a major shake-up if the gold price stabilised at these lower levels, with large chunks of production deemed uneconomic, forcing the rationalisation and merger of many mid-ranked companies. ''It's only a handfull of large-low cost operations like Lihir (LHG.AX), Great Central's (GCM.AX) Bronzewing and the Superpit (NDY.AX)(HM - news) that'll survive these low prices,'' Walker said. Other new projects could be put on hold, including Newcrest's Cadia Hill mine and Normandy's Wandoo project. ''Some of the big, low grade projects like Cadia and Wandoo are going to be under a fair amount of pressure,'' Walker said, adding that these low prices could force a 20 to 30 percent fall in Australia's annual gold output. Australia's major commodities forecaster, the Australian Bureau of Agricultural and Resource Economics (ABARE) forecast in September that Australia's gold output would rise 9.4 percent to 344.9 tonnes in the year to June 30, 1998. Tony