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11:30AM Lehman says gold stocks not cheap despite recent fall ($GOX) by Tomi Kilgore Analyst Peter Ward at Lehman Bros. feels that despite recent weakness in the gold sector, the reward-versus-risk profile is still "unfavorable." Ward noted that the price of gold averaged $312 per ounce in the second quarter, the highest quarterly average since the third quarter of 1997, but most companies he covers posted "meager" earnings. He believes gold stocks have already discounted a "significant and sustainable" rise in gold prices but thinks it will prove "unsustainable," given that the current strength is being driven primarily by the buyback of producer hedge positions. "For some time, there has been a perception that gold stocks are effective portfolio diversifiers in down markets. We respectfully disagree," Ward added. "Despite recent weakness, the overall U.S. equity market has performed much better." The S&P 500 Index ($SPX) is down 8.30 points at 894.48, a decline of 16.2 percent since the end of May. Meanwhile, the CBOE Gold Index ($GOX), currently down 0.3 percent, has now lost 27.5 percent.
I think we can agree to disagree. I'm a trader while you are a LTBH. There are times to hold long and this is not one of them IMO.Yes I think gold can go up from here, but I play the market for what I can get, and will only hold long when I get the right signals.
On Monday Harmony reports June 2002 quarterly results. Results will be screened live at 12:00 SA time (6:00 a.m. ET) on Harmony's web site at harmony.co.za . A conference call will be conducted at 11:00 a.m. ET. Visit Harmony's web site for details about participating in the conference call.
Back on May 7th Polarbear laid out the case as to why the June quarterly report could be astonishing. You can read the analysis here: gold-eagle.com One thing to keep in mind is that the POG has dropped from the price used in the article.
If Polarbear's observations come to fruition, I think Harmony's price should step up a few notches. Comments are welcome from all regarding the current validity of Polarbear's observations.
Today (Friday) may be the last day to buy into Harmony before the effects of the quarterly report are felt.