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The gold bugs are definitely back and beaming this week.
After months of being whacked by war-induced inflationary pressures leading to a resilient US dollar, the shiny yellow metal came roaring back to life as cracks began appearing in the American economy.
July’s non-farm payrolls (non-seasonal jobs) unexpectedly went backwards in reporting this week, shedding 23,000 jobs and reinforcing the view that the world’s largest economy may finally be cooling.
Traders immediately began scaling back expectations of further rate hikes, while bond markets staged an unexpected rally after the US Treasury quietly doubled its planned buybacks of long-dated debt in an attempt to steady the bond market.
The Government printing more money to add to the already-groaning weight of more than US$40 trillion (A$61 trillion) in national debt is never a good sign of prosperity.
The result was a familiar one. The US dollar softened to a runny egg and gold exploded higher, surging more than six per cent to US$4550 (A$6910). Copper, meanwhile, refused to give an inch, holding firm near US$6.50 (A$9.95) per pound as the market struggles amid chronic supply shortages, remaining a powerful long-term red metal driver.
Back home, Australia’s own inflation architects were quietly celebrating a milestone of their own. Federal debt has now blown through the trillion-dollar mark, leaving taxpayers with the privilege of funding record government spending while somehow managing higher taxes, higher electricity prices and a cost-of-living crisis that seemingly adds more brainwash initiatives by the second.
An unexpected, good news story of the week came in the final reprieve for the ASX’s healthcare index, which was up a staggering 14 per cent in just one week.
Former market darling and once Australia’s largest listed company, CSL, has had a ripping week after the healthcare giant spent the past year being treated like a biotech penny dreadful, shedding almost $90 billion in value from its highs. Investors finally decided enough was enough. The stock exploded nearly 18 per cent in a single session after management delivered better-than-expected FY26 numbers and forecasts for the year to come.
The resources sector also continued to remind everyone where Australia’s real economic engine sits. BHP surged almost seven per cent as copper held its ground as the market’s metal of choice, while New Zealand’s biggest precious metals producer, OceanaGold, lobbed a hefty $776 million bid for Ausgold’s Katanning gold project in Western Australia.
It seems OceanaGold, unable to expand its considerable resource base in NZ thanks to the government’s insistence on ignoring its own mineral wealth, has decided it’s time to expand into WA. The message is clear: quality ounces are making the big players move and they’re no longer waiting for developers to build the mines themselves.
The Bulls N’ Bears Runners cavalcade this week perfectly mirrored the renewed gold sentiment, with the precious metal once again stamping its authority on the list. Pay-outs and payloads were the themes of the week for the minors, with a plucky gas explorer also making a late charge after plunging a well into one of Queensland’s most prolific gas basins.
The Bulls N’ Bears Runner of the Week is Genesis Resources, which took off in spectacular fashion this week after returning rock chip grades of up to 28.8 grams per tonne (g/t) gold from reconnaissance sampling at its Arltunga copper-gold project in the Northern Territory.
Now, high-grade gold samples from surface are always going to get the market’s attention, but one struggles to recall too many occasions where a handful of rock chips have ignited a 500 per cent share price rally. Genesis rocketed to a high of 3c this week – its highest point in almost a decade. With gold back in favour and the company’s tightly held share register acting as an amplifier for every buy order, it was the perfect storm for this feisty junior to claim the top spot.