CAPITAL MARKETS

Gold gains allure

The gold price has risen, with the allure of the safe haven asset growing as investors eye the rise in COVID-19 cases above 9 million.

Staff reporter
 Sierra Metals’ Cusi mine in Mexico

Sierra Metals’ Cusi mine in Mexico

The US has more than 2.3 million confirmed COVID-19 cases, followed by 1.1 million in Brazil, and there have been more than 471,500 deaths according to Johns Hopkins University today.

The precious metal was worth US$1,765 an ounce on the spot market earlier, a level last seen in October 2012, and was around $1,755/oz at the time of writing.

"Certainly economic and geopolitical factors look to be positive for the gold price going forward," Sharps Pixley precious metals commentator Lawrie Williams wrote yesterday.

"This is despite the recently seemingly unstoppable rise in equities markets - which we feel may still be due for a mega-crash."

Market futures were mostly positive after North American indices closed higher yesterday.

Sierra Metals (TSX: SMT) surged in Toronto, touching a 52-week high of C$3.68 before closing up 65.7% to $2.32.

It had last week confirmed a new, high-grade silver zone at its Cusi mine in Mexico.

It also said mine development had begun in a zone to bypass an area of subsidence and production would then resume, and it would start studies on a potential expansion for the company's smallest operation.

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