Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Gold/Mining/Energy : Savanna -- Ignore unavailable to you. Want to Upgrade?

To: waldo who wrote (94)	8/6/1998 1:14:00 AM
From: waldo	Read Replies (1) \| Respond to of 192

Encouraging report on gold from the Sydney Morning Herald: Thursday, August 6, 1998 RESOURCES Shake-out in stocks to boost gold and miners By KATE ASKEW Falling US shares will help lift gold prices by up to 25 per cent by the end of this year, sparking a major re-rating of mining stocks, says a leading North American gold analyst. "I think it [the gold price] will be $US320 to $US350 [an ounce] by November," CIBC Oppenheimer's director equity research, Mr Tom McNamara, told the Diggers and Dealers conference in Kalgoorlie. Mr McNamara, one of North America's top five gold analysts, said as the US dollar and equity markets came under pressure, investors would buy gold. Tuesday's Wall Street slump and bullion's corresponding $US5.40 rise to $US282.95 lends weight to his theory. Also, based on average historical prices, gold is relatively cheap. Gold prices have averaged $US373 in the past 10 years and the 15-year average is $US377. "This is one of the opportunities of the century [for investors]," Mr McNamara said. He said the overwhelmingly negative sentiment in the sector was not based on fundamentals, and short-covering rallies in the bullion market would prompt greater levels of investor interest. Central bank gold sales - kicked off by the Reserve Bank's sale of two-thirds of its gold stocks last year - are largely completed and more disposals of central bank reserves are unlikely. Also, central banks will continue to become more transparent on their position on gold ahead of European Monetary Union next January, making it harder to short the gold market. Indications are that North American investors have seen the opportunities and are looking beyond their home turf for growth. "I think you'll definitely see US companies picking the dirt in Australia," Mr McNamara said. In fact, a management contingent from Kinross Gold is in Australia visiting institutions and talking to stockbroking houses with the aim of seeking acquisitions in Australia. Kinross recently merged with Denver-based Amex Gold to become North America's fifth-biggest gold company.