The US unemployment data released on Friday was extremely positive, increasing the likelihood of an interest rate rise in the US

Nicholas Forsyth

Market Matters

The US unemployment data released on Friday was extremely positive, increasing the likelihood of an interest rate rise in the US. Higher rates, with no obvious inflation is very bearish for gold, which pays its holders nothing. Fundamentally, I find it impossible to be optimistic gold at present. No market pundits were talking the Gold Story when we bought both RRL and NCM in late 2014, but over recent weeks, it has been receiving more airplay which is a classic contrarian sell signal. Gold - Recent price weakness coupled with negative fundamentals has turned me neutral at best. NCM - sold part of its EVN stake recently to reduce debt as the management continue to regain the markets confidence. Technically, the stock is neutral here, but a break of $12.50 would be very negative. RRL was hammered on Friday after they announced a decreasing grade of ore mined. However, the company has also negotiated a restructure of its debt, relaxing the restrictions on the payment of its dividends. Technically, the stock looks awful targeting fresh recent lows under $1.20. See full report (VIEW LINK)


Nicholas Forsyth
Nicholas Forsyth
Director
Market Matters

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