Gold Jumps On Weak Chinese Economic Data

Gold Jumps On Weak Chinese Economic Data

Gold prices added gains for the second consecutive session today, as Chinese economic slowdown boosted the appeal for yellow metal. Gold Futures for June 2016 delivery surged 0.84% to $1,283.35, hitting a one-week high.

Slipping into slowdown

In China, industrial production in April inched up by 6% on an annualized basis, below the forecasts of 6.5% increase. Fixed asset investments also rose 10.5% during the previous month, well below the projections of 10.9% growth. These set of data follow weak trade and inflation numbers published last week, which has once again sparked concerns over the stability of the world’s second biggest economy.

Gold posted limited gains on Friday last week after the series of data in the U.S. turned out to be positive. Retail sales in the U.S. grew 1.3% in April, representing the largest gain in last one year. Additionally, the preliminary reading for consumer sentiment in May surged to 11-month high of 95.8, driven by better employment prospects, rising incomes, and low inflation.

Goldcorp to buy Kaminak

McEwen Mining Inc (NYSE:MUX) recently revealed first quarter profits. It reported net income of $13 million in the reported quarter, which implies earnings of $0.04 per share. Revenues came in at $21.2 million during the same period.

Goldcorp Inc. (USA) (NYSE:GG) is in the process of finalizing its deal with Kaminak Gold Corporation. As per the deal, Goldcorp has agreed to acquire all outstanding shares of the latter in lieu of C$520 million. The deal is likely to be concluded by August this year. Each share of Karminak is valued at C$2.62 as per the agreement.

Seabridge Gold, Inc. (USA) (NYSE:SA) booked losses close to $2.5 million during the first quarter. On a per-share basis, the loss amounted to $0.05. It also revealed its plans to acquire SnipGold during the release of the report.