Here's why the Northern Star (ASX:NST) share price has lost 11% in 2 weeks

September hasn't been a great month for the Aussie gold miner…

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The Northern Star Resources Ltd (ASX: NST) is not having a great time of it right now. Shares in the Aussie gold miner fell lower on Thursday and are now down 11% in the past fortnight.

Here's what's weighing on the company's valuation in September.

Why the Northern Star share price is down 11% in 2 weeks

The latest share price moves don't appear to be driven by any big company news. In fact, Northern Star hasn't provided any price-sensitive news since September 16 when it completed its Central Tanami Project joint venture.

Perhaps the bigger factor at play is gold prices. Whenever ASX resources shares like Northern Star are under pressure, it can pay to see what the broader market is doing as well as underlying commodities.

It's true the last 2 weeks haven't been great for the S&P/ASX 200 Index (ASX: XJO). The broad market index has edged 0.8% lower in the past fortnight weighed down by tech and resources shares.

Chief among those falling resources shares are ASX gold shares like Northern Star and Newcrest Mining Ltd (ASX: NCM). Much of those movements can be traced back to falling global gold prices.

Gold has historically been viewed as a safe haven asset. That means it has tended to be in demand, and therefore perform strongly when shares are underperforming. It's also often seen as a good hedge against inflation, which is what many investors expected we'd see a lot of in 2021.

However, that hasn't necessarily been the case. With yields rising on expectations of a sooner than expected US Federal Market Open Committee (FOMC) rate hike, gold prices are falling.

In fact, more investors have been flocking towards the US dollar for safety in recent weeks and away from gold. That has reduced demand and sent prices of the precious metal tumbling.

We've seen that reflected in the Northern Star share price of late. Shares in the Aussie gold miner are down 11% in the last 2 weeks and 36.2% for the year.

Foolish takeaway

The Northern Star share price is under pressure in 2021 and September has not been a month that investors will want to remember.

Shares in the Aussie gold miner are trading at a price to earnings (P/E) ratio of 7.4 with a 2.2% dividend yield on Thursday afternoon.

Motley Fool contributor Ken Hall has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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