Why is the Evolution Mining (ASX:EVN) share price surging 10% today?

It’s a good day to be an Evolution shareholder…

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A woman wearing a top of gold coins and large gold hoop earrings and a heavy gold bracelet stands amid a shower of gold coins with her mouth open wide and an excited look on her face.

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Key points

  • The Evolution Mining share price is currently trading 9.97% higher at $4.19
  • The gold producer’s stock might be being driven by the gold price’s overnight rally
  • At the end of Wednesday’s session, February gold futures was sitting at US$1,843.20

The Evolution Mining Ltd (ASX: EVN) share price is on a roll today despite no news having been released by the company.

However, it might be being boosted by soaring gold prices. The price of the golden commodity surged 1.7% overnight, perhaps bolstering confidence in the gold producer.

At the time of writing, the Evolution Mining share price is $4.19, 9.97% higher than its previous close.

For context, the S&P/ASX 200 Index (ASX: XJO) and the All Ordinaries Index (ASX: XAO) have slipped 0.23% and 0.19% respectively today.

Let’s take a closer look at what might have boosted the gold miner’s stock into the green on Thursday.

What’s driving the Evolution Mining share price higher?

The Evolution Mining share price is soaring in the wake of gold futures’ strong Wednesday gain.

Overnight, February gold futures closed 1.7% higher at US$1,843.20 an ounce. That’s the highest the price of gold has been in 2 months.

However, it’s dropping once more in Thursday’s trade. It’s currently going for US$1840.40 per ounce – representing a 0.15% dip.

According to commodities-focused media outlet Kitco, the metal’s price was likely driven by rising inflation in both the United Kingdom and Canada

As gold is generally seen as an inflation hedge, international concerns probably had a positive effect on its value.

And, of course, the metal’s price is generally a direct tie to Evolution Mining’s earnings.

As one might expect, Evolution Mining isn’t the only ASX gold producer seemingly benefiting from gold’s gains.

The Northern Star Resources Ltd (ASX: NST) share price is currently up 9% while that of Perseus Mining Limited (ASX: PRU) has gained 7%.

Today’s surge has also placed the Evolution Mining share price back into the year-to-date green.

Right now, it’s 3.2% higher than it was at the start of 2022. Though, it’s still 10% lower than it was this time last year.

Motley Fool contributor Brooke Cooper 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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