At time of writing, the share price of Evolution Mining Ltd [ASX:EVN] is down 1.7%, trading at $4.35 apiece.
This is the Evolution share price matched up with the VanEck Vectors Gold Miners ETF [NYSEARCA:GDX]:
It’s gone through periods of strong correlation, meaning that despite today’s encouraging quarterly, Evolution mining could have been affected by movements in GDX or other gold ETFs.
Highlights from the Evolution quarterly
Here are some of the highlights from the Evolution quarterly:
- Record mine operating cash flow of $278.7 million up 30% against last quarter
- Net cash position up to $91.7 (up from last quarter’s $35.2 million)
- AISC of $1018
- Production guidance of 725,000–775,000 ounces unchanged
With record production, their Cowal operation is bringing in a big chunk of their operating cash flow with $89.9 million generated from the NSW mine.
All-in-all a positive announcement.
Evolution share price impacted by a variety of factors
The gold price stands at US$1,497 today.
It has been trading in a relatively tight range over the last two months following a quick surge starting in June:
So it is important to remember the variety of factors impacting the Evolution share price.
- The gold price
- Federal Reserve rate cuts
- Recession fears (linked to above)
- Trade war fears/hopes
- Gold ETFs
The last one may be relevant today.
GDX took a tumble on Friday as trade war news broke, indicating a truce could be on the cards.
With ‘Phase 1’ of the deal in place, Reuters reported the following comments by US Treasury Secretary Steve Mnuchin:
‘I think we have a fundamental understanding on the key issues. We’ve gone through a significant amount of paper, but there is more work to do.’
GDX sold down, and as 2.94% of its holding as of 11 October were in Evolution, this could be dragging the Evolution share price down.
The world of gold is a complex beast it seems.
If you are after more discussion of gold’s potential, be sure to check out our editor’s recent interview with Jim Rickards, which you can see here.
His interview with the Perth Mint CEO is also a must see.
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