The S&P/ASX 200 Index (INDEXASX: XJO) has managed to claw its way back into positive territory by mid-afternoon on Thursday despite being lower at lunchtime.
The turnaround hasn't helped the fortunes of gold and iron ore miners however…
At 2:30 pm gold producers Northern Star Resources Ltd (ASX: NST), Medusa Mining Limited (ASX: MML) and Regis Resources Limited (ASX: RRL) had each fallen between 4.5% and 7%, while iron ore miners Atlas Iron Limited (ASX: AGO) and Fortescue Metals Group Limited (ASX: FMG) were both around 3% lower.
The declines come after both gold and iron ore suffered falls in overnight trade. This morning iron ore was down 0.4% selling at US$84.30 a tonne, while gold was down 0.6% to US$1,228 an ounce.
With the gold price now very close to what many believe to be the marginal cost of production for many miners, some investors are starting to entertain the idea that it's time to begin selectively buying gold producers amongst the beaten-up sector. Add in the potential for a bout of inflation in the U.S. once the Federal Reserve begins to raise rates, coupled with the global-macro-economic concerns and the case for buying gold mounts.
When it comes to iron ore miners however the case for buying continues to remain far from obvious with expectations for weakening demand from China and an enormous rise in supply making the outlook for the sector far from certain.
