Precious Metals Preview: Gold Facing Selling Pressure in Asia

MCX Gold edged up from lows yesterday but the undertone remained mixed for the metal COMEX Gold futures are trading at $ 1329 per ounce right now- down 0.25% on the day. US stocks dropped as the soaring US 10 year bond yields hurt sentiments. Commodities also reeled under pressure. US economic data was good. The Conference Board released a report on Tuesday showing an unexpected rebound in consumer confidence in the month of April. The Conference Board said its consumer confidence index rose to 128.7 in April. MCX Gold closed up 0.33% at Rs 31381 per 10grams and should slip today.

Mining giant Barrick Gold Corp reported that first-quarter adjusted earnings rose from a year ago despite lower production, following higher gold prices. Adjusted net earnings jumped 5% to $ 170 million, or 15 cents per share, from $ 162 million, or 14 cents, in the first quarter of 2017. The company reported net earnings of $ 158 million, or 14 cents per share, for the January-March period, down from $ 679 million, or 58 cents, a year ago. However, the prior-year earnings were inflated by a net impairment reversal of $ 1.13 billion ($ 522 million after taxes and non-controlling interest); in connection with Barrick’s divestment of 25% of the Cerro Casale project.

Barrick produced 1.05 million ounces of gold in the first quarter at all-in sustaining costs of $ 804 per ounce. In the year-ago quarter, output was 1.31 million ounces at AISC of $ 772 per ounce. However, the amount of money that Barrick received per gold ounce rose to $ 1,332 per ounce from $ 1,220. It produced 85 million pounds of copper in the first quarter, down from 95 million in the year-ago period. AISC rose to $ 2.61 per pound from $ 2.19. However, the average realized price rose to $ 2.98 per pound from $ 2.76.

Barrick expects gold production in the second quarter to be roughly in line with the first quarter at around 1 million ounces, mainly due to the impact of a scheduled maintenance shutdown at the Barrick Nevada roaster. The company maintained full-year copper production guidance of 385 million to 450 million pounds at AISC of $ 2.30 to $ 2.60 per pound.