The best gold shares and gold miners on the ASX are all the rage with the gold price on a tear, thanks to an unexpectedly dovish stance from the US Fed with markets pricing in a 25 basis point cut to U.S. cash lending rates when the Fed meets on July 31.
A lower cash rate would equal lower risk free returns across the board including on cash, money market securities and benchmark 10-year US treasuries. As such gold as a 'store of value' should be more attractive as its lack of income also looks less bad versus increasingly feeble yields on other assets.
As a result of changing macro expectations the US dollar gold price has raced to US$,1421 an ounce this afternoon, which is just about A$2,000 an ounce.
Gold miners like Regis Resources Ltd (ASX: RRL) are now printing near A$1,000 per ounce profit margins on gold with all in sustaining costs at its mines around A$1,029 over FY 2019.
While larger miners like Newcrest Mining Limited (ASX: NCM) and Northern Star Resources Ltd (ASX: NST) have risen 65% and 100%, respectively, over just the past year.
However, Newcrest shares may have gotten ahead of themselves at $33.89 this afternoon if the powerful analysts at Goldman Sachs are on the money.
According to a July 10 research note out of the bank Newcrest shares are worth just $26, with the bank assuming a "long-run" gold price of US$1,400 per ounce.
Goldman's also values St Barbara Ltd (ASX: SBM) and Regis Resources shares at $3.90 and $4.30 respectively.
