The SPDR Gold Trust (ETF) (NYSEARCA:GLD) has pared its earlier gains as buying interest for the safe haven asset appears to be fading out for now. Gold prices dropped $30, concluding the metal’s rally yesterday fueled by the Brussels attack.
Appetite for safe assets diminishes
During the early U.S. market hours, Gold Futures for April delivery plunged 2.16% to $1,221, erasing all of its previous day’s gains and more. Gold has witnessed an uptick of roughly 20% this year due to increased appetite of safe assets in the wake of global uncertainty. Also, there is an inverse link between gold and the U.S. dollar, and thus, an ongoing recovery in the greenback is hurting dollar-denominated gold.
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Jim Steel, an analyst at HSBC, pointed out that terror attacks would lead to only short-term momentum in gold as the U.S. dollar and risk appetite levels have a greater role to play in impacting gold prices.
Eldorado’s fourth quarter earnings awaited
In gold stocks, B2Gold Corp (NYSEMKT:BTG) recently reported its financial results for the fourth quarter and financial year 2015. The company reported record gold production of 131,469 ounces in 2015, which represents 18% growth year-on-year. The company has also succeeded in maintaining its costs below the lower end of guidance to $947 per ounce during the financial year.
Gold investors will closely follow updates from Eldorado Gold Corp (USA) (NYSE:EGO), which is set to report its fourth-quarter earnings today. According to market consensus, the gold miner could report a decline in its profits and revenues. Analysts anticipate the company to break even on a revenue of $198.97 million during the last quarter. In the previous year, the company had reported earnings per share of $0.04 on revenues of $259 million.
At the same time, pressure on Kinross Gold Corporation (USA) (NYSE:KGC) eased down after it responded to Chile’s environmental regulator, SMA’s legal suit over the discontinuation of water to Maricunga mine on account of environmental damage.
