Gold mining companies' shares rose on Wednesday, February 5, on Wall Street, driven by a new historical gold price record of $2,869.68 per ounce. This impressive rise occurred amid renewed trade tensions between Washington and Beijing, prompting investors to seek safe havens.
Gold Mining Companies' Stock Surge
Major gold mining companies listed in the United States recorded significant gains as markets opened. Sector giants like Newmont and Barrick Gold increased by 1.1% and 1.3% respectively. South African miners also benefited: Gold Fields increased by 2.5%, while Canadian companies Agnico Eagle Mines and Kinross Gold gained 1.3% and 1.7%.
Gold Supported by Global Uncertainties
The recent escalation of trade tensions between the US and China played a crucial role in the rise of gold prices. The US introduced new tariff measures, to which Beijing quickly responded by imposing its own tariffs on American imports. President Donald Trump indicated that he was not in a hurry to speak with President Xi Jinping to ease tensions. Analysts from Heraeus Metals Germany point out that concerns of a potential global recession and rising inflation, fueled by this trade war, are pushing investors towards gold as a safe haven.
Conclusion
The gold price surge is supported by increasing geopolitical tensions and continued central bank purchases. StoneX analyst Rhona O’Connell warns of signs of overbuying with a relative strength index of 76, significantly exceeding the critical threshold of 70. A short-term correction seems likely despite solid fundamentals.
Record gold prices have led to a surge in gold mining stocks, supported by global economic and political factors. A short-term correction is anticipated, though gold remains a popular asset in times of instability.
