Boston, MA 10/25/2013 (wallstreetpr) – In recent times, among the most costly and sort after mineral has been on a downward spiral. However, as expected there has been a ray of hope and among the companies breathing a sigh of relief is Barrick Gold Corporation (NYSE:ABX). Recently HSBC upgraded the stock ratings on various gold companies among them being Barrick Gold Corporation. Demand for gold has remained strong but the lower prices have resulted into lower supply due to the cost of production. With the rebound of gold in the horizon, this will bring better value to some of the miners and BSX in particular. In the last few days gold has enjoyed a nice run with Gold Bullion climbing to $1,340 per-troy-ounce area.
The recent rally in the gold prices has been attributed to several factors; the main factor being the weakening dollar. Other factors that have contributed to the rebound in gold prices could be the coming back into play of the economic reports that were delayed while the government was closed. This has seen traders short-covering. Inflation, central bank’s buying and selling and geopolitical events have also contributed to the short term rise in gold prices.
As much as these facts have played a role in one way or the other, the main role in the mining sector worth to be noted is that the producer wants to make money. The producer cannot make money if the commodity has low prices that cannot cover the production cost. Unless the producing company has the undeniable hope that the prices will bounce back soon they cannot operate at a loss. With that in mind, it is necessary to note that with gold prices back in action, Barrick Gold Corporation is most likely to have a good run after the dismal time.
