Join our community of smart investors

Brexit: Rush for gold among volatile commodities

The tight relationships between currencies and commodities mean there have already been big movements in commodities markets – and natural resources stocks
June 24, 2016

The market turmoil sparked by yesterday’s Brexit vote has not been confined to currencies, stocks and bond markets. Commodities have also shown wild swings, most notably in the gold price, which in early trading spiked to as high $1,351 an ounce as investors moved into safe havens amid what is likely to be further extreme volatility. Though these gains have pared back, the rise pushes the gold price through the $1,300 resistance level it has flirted with in recent weeks and the expectation is that the $1,400 level will be passed.

Sterling-denominated gold has fared even better. At pixel time, the yellow metal had risen to £953 an ounce, a level not seen in more than three years.

Inevitably – as we explained in last week’s feature on the case for gold – this has been good news for the metal’s miners. Some of the larger stocks in the precious metals space have done remarkably well. Gains include Randgold Resources (RRS), this morning's biggest stock market riser at 16 per cent higher, Acacia Mining (ACA), up 14 per cent, followed by Fresnillo (FRES), 12 per cent to the good, and Centamin (CEY) and Pan African Resources (PAF), 8 per cent and 11 per cent higher respectively.

To continue reading...
REGISTER FOR FREE TODAY
  • Read 3 articles for free each month
  • Educational articles and topical investment guides
  • In-depth podcast episodes by our writers and industry professionals
  • Interactive live webinars on investment themes that matter
Have an account? Sign in