Gold fell by 2.1% on Tuesday, as the S&P 500 hit a new record high, and tensions eased in Ukraine, after national forces regained control of key areas, and the country’s leading presidential candidate, Petro Poroshenko, said he wanted to resolve the crisis with Russia. On Wednesday morning, gold was trading at $1,265 per ounce, down by around 3.5% from the highs of $1,310 per ounce seen earlier in May.
The main routes by which traders and investors gain exposure to gold are exchange-traded gold funds such as the $33bn SPDR Gold Trust (NYSE: GLD.US) ETF, which has fallen by 2.1% so far this week to $121.85, paring its year-to-date gains to just 3.3%. Meanwhile, a London-listed alternative, Gold Bullion Securities (LSE: GBS), has fallen 2.4% to $121.362 so far this week, reducing its gains for 2014 to just 1.3%.
Gold equity news
In the gold equity markets, South African gold miner Central Rand Gold (LSE: CRND) was one of the day’s standout performers, gaining up to 20% on heavy trading volumes, after reporting that the installation of a third mill at its South African gold mine has been completed and will increase production capacity by 55%. The firm said that capacity was now expected to rise to 28,300 tonnes per month (tpm), although it will be managed at 20,000 tpm until upgrades to the mine’s leaching capacity have been completed.
Central Rand also reported that pumping and treatment operations have commenced at the High Density Sludge plant operated by the Trans Caledon Tunnel Authority. This will lower water levels in the Central Basin area in which Central Rand and other miners operate, giving them access to deeper mining levels, which could open up new resources for the firm.