Precious Metals Weekly Round-Up: C$1 Billion Palladium Deal Steals Show

The gold price spent time under US$1,500 per ounce this week, pressured by factors such as progress on US-China negotiations and apparent light at the end of the Brexit tunnel. 

Global powerhouses China and the US are reportedly closer to reaching a deal on trade negotiations, while in Europe plans are coming into place for the UK’s exit from the European Union.

“Optimism over the U.S.-China trade situation has fueled a stock market rally, which is the reason for gold underperforming in the last couple of days,” Forex.com analyst Fawad Razaqzada told Reuters.

Kitco’s Jim Wyckoff spoke separately to the news outlet about Brexit.

“There are reports that the UK and the EU may be making some progress on a Brexit that won’t be a hard Brexit and that’s lifting European spirit so all that is working against the gold market,” he said.

As of 1:44 p.m. EDT on Friday (October 11), gold was on track for a weekly loss, sitting at US$1,483.50.

Silver was trading at US$17.46 per ounce at that time, while platinum was at US$895 per ounce and palladium was at US$1,679 per ounce.

Top precious metals news stories

The Investing News Network’s (INN) precious metals coverage this week centered on a major acquisition in the space, plus stock picks from experts in the industry.

1. Impala Platinum to Buy North American Palladium in Billion Dollar Deal

Palladium made major headlines this week when Impala Platinum (Implats) (OTC Pink:IMPUY,JSE:IMP) announced plans to buy North American Palladium (TSX:PDL,OTC Pink:PALDF).

Opinions are mixed on the C$1 billion transaction, with some experts saying it makes sense and others offering various criticisms of the deal.

“Our disappointment in the Implats offer stems not only from the implied 15 percent discount but also from the timing. PDL is in the midst of its ramp-up to 12 kilotonnes per day from underground, which has progressed well up until now. We were expecting the shares to perform well as that project is approaching completion in early 2021,” said David Stewart of GMP Securities.

Want to learn more about North American Palladium? Click here to listen to INN’s recent interview with President and CEO Jim Gallagher.

2. Gold and Silver Stock Picks from US Global’s Ralph Aldis

Fans of Frank Holmes will be familiar with US Global Investors (NASDAQ:GROW), but perhaps not with Ralph Aldis, the company’s portfolio manager and senior mining analyst. Aldis spoke with INN recently to share his stock picks in the precious metals space.

Among the royalty and streaming companies, he pointed to Franco-Nevada (TSX:FNV,NYSE:FNV), Royal Gold (NASDAQ:RGLD) and Wheaton Precious Metals (TSX:WPM,NYSE:WPM). In terms of smaller-cap gold stocks, he suggested Barsele Minerals (TSXV:BME) and TriStar Gold (TSXV:TSG).

3. 5 Gold Stocks to Watch in 2019

Looking for more gold stock picks? Analysts at Raymond James recently shared a list of the companies in the space that they believe have high upside potential. Click above to see which ones made the list.

Other precious metals news

Australia’s Perth Mint and the UK’s Royal Mint were both in the news this week.

On Friday, the Perth Mint released the Perth Mint Gold Token (PMGT), a digital token backed 1:1 by GoldPass certificates. The certificates are issued by the Perth Mint, and the PMGT itself is issued by InfiniGold. The PMGT is intended to compete with gold-backed exchange-traded funds and US dollar-backed stablecoins.

The same day, the Royal Mint launched Raris, which it bills as “the world’s first hallmarked precious metals payment card.” Created in association with Mastercard (NYSE:MA) and Accomplish Financial, the debit card is made of gold and costs US$23,440. Its benefits include zero foreign transaction fees, and, of course, bragging rights.

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Securities Disclosure: I, Charlotte McLeod, hold no direct investment interest in any company mentioned in this article.