Gold Penny Stocks Back In Focus After Fed Rate Cut
Over the weekend, the U.S. Federal Reserve announced another emergency rate cut to between 0% and 0.25%. These are some of the lowest rates in history. While the broader market rout continued on Monday morning, something different was happening for gold stocks after the opening bell. What was different?
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While the majority of stocks were dipping further, gold and gold penny stocks began to lift. The clear indications were being made that the slide in gold prices wasn’t necessarily due to a soft market. Many analysts suggest that a retreat in gold prices was due to investors pulling money from safer havens to protect themselves from the broader market sell-off.
In light of this, investors have once again begun to pile back into gold as underlying economic factors haven’t changed much. In fact, junior gold stocks have benefited the most so far, thanks, in part to the latest series of rate cuts by the Fed.
As a rule of thumb, lower rate environments lend themselves favorably to gold stocks in general. Considering that corporate debt continues to grow while rates continue to decline, this could be one of the best times to have gold penny stocks on your watch list. With that, here are 4 names that have been making waves already, this week.
Gold Penny Stocks To Watch: IMC International Mining
IMC International Mining (IMCX)(IMIMF) has been one of the top junior gold discovery stocks to watch. Despite it being one of the smaller companies, the fact remains that this gold stock hasn’t seen nearly the same level of selling pressure others have. For the most part, IMC International stock has managed to uphold a channel trend between $0.40 and $0.50CAD for weeks. Considering that most of the other gold stocks dropped to new 2020 lows this week, it is saying a lot when it comes to looking to top gold stocks right now.
Most recently, IMC International reported that it would acquire Thane Minerals. In a February update, the company announced a letter of intent to purchase Thane in a multi-million dollar deal. Following up last week, IMC reported plans to close on this deal during mid-March. Seeing that not only gold prices are rebounding but it is currently mid-March, now could be a very important time to watch IMC International.
Thane’s Cathedral property could open up big possibilities for IMC as it’s located in a very mineral-rich area of British Columbia called the Quesnel Terrane. According to reports, Quesnel hosts past and planned production. Also, given the fact that Cathedral is in the middle of two other mines with significant copper and gold deposits, Cathedral further poses new opportunities for IMC.
Rider: It is noted that the results of nearby or adjacent properties are not necessarily indicative of the potential of the Cathedral property and should not be understood or interpreted to mean that similar results will be obtained from the Cathedral property.
Gold Penny Stocks To Watch: IAMGOLD Corp
Next, IAMGOLD Corp (IAG) has seen a strong reversal in trend on March 16. Following a dip to lows of $1.44 right at the open, IAG stock shifted course and rallied to highs of over $2. This move saw shares bounce back above its previous closing price on Friday by more than 6%. Furthermore, since the opening bell, the gold stock has bounced back by as much as 44%.
Much of the move had to do with the reversal in gold prices this week. Gold furtures indicated a lower open on Monday. However, fundamentals on economics and financials won the fight in the end. This saw investors flocking back to safe-haven gold stocks; both junior and major. While stocks like Barrick Gold stock (GOLD) saw handsome gains, the juniors continue to outshine larger precious metals stocks on Monday.
Gold Penny Stocks To Watch: Gold Fields Ltd
Gold Fields Ltd (GFI) was another top gold penny stock to watch on Monday. Shares responded similarly in the morning with GFI stock hitting new 2020 lows. After that, the gold penny stock shot up to highs of $4.80 to mark an intraday move of 22%. What appeared to be a bearish day for gold stocks turned out to be one of the best recoveries of the year so far. Needless to say, Gold Fields has more than just gold price to help push momentum as well.
In a recent update by Asanko Gold (AKG) gave new data on estimated mineral reserves at its Asanko Gold mine. This mine is 50:50 owned by Asanko and Gold Fields. According to the company Estimated Measured and Indicated Mineral Resources of 64.1 million tonnes at 1.70 g/t gold for 3.50 million ounces of gold contained. Furthermore, Estimated Proven and Probable Mineral Reserves came in at 53.4 million tons at 1.38 g/t gold for 2.38 million ounces of gold contained.
Greg McCunn, Chief Executive Officer of Asanko said, “2020 and 2021 are both expected to be good years for the mine with projected strong free cash flow. Using this updated life of mine plan as a baseline, we are launching a major cost reduction initiative at the AGM and increasing focus on exploration on our prospective 21,000-hectare land package.”
Gold Penny Stocks To Watch: Yamana Gold
Shares of Yamana Gold Corp (AUY) ended up taking off on Monday. The gold penny stock opened trading at $2.30, which was down from its previous close of $2.71 on Friday. While this suggested another bearish day of trading, gold prices obviously helped turn things around. By the lunch hour, Yamana gold stock had managed to rally to highs of nearly $3 on an intra-day move of 30%.
The bigger focus on Yamana has been regarding its recent royalty sale. In February the company reported that it sold its royalty portfolio related to the Gualcamayo gold mine to Guerrero Ventures. The price tag was a cool $65 million with $45 million of it being a position in a newly formed company. According to its press release, “Yamana stands to benefit from participation in the new company, a pure-play precious metals royalty company that has significant potential upside through mineral resource expansions and mine life extensions.”
After such a reversal in trend, could Yamana gold stock continue to move higher this week? A lot will depend on the price of gold but considering the new interest in the sector, now could be the best time to watch gold penny stocks.
Pursuant to an agreement between Midam Ventures LLC and IMC International Mining Corp. (CSE: IMCX) (IMIMF), Midam has been paid $200,000 for a period from January 7, 2020, to February 14, 2020. Midam has been paid an additional $200,000 and extended its period of coverage to March 14, 2020. Midam has been paid an additional $200,000 and extended its period of coverage to July 9, 2020. We may buy or sell additional shares of IMC International Mining Corp.(CSE: IMCX) (IMIMF) in the open market at any time, including before, during or after the Website and Information, to provide public dissemination of favorable Information about IMC International Mining Corp. (CSE: IMCX) (IMIMF). Full disclaimer here.