The All Ordinaries Index (ASX: XAO) is enjoying a welcome reprieve from the recent wave of selling, up nearly 1% in afternoon trade.
And two ASX gold shares are doing some of the heavy lifting.
The Gold Road Resources Ltd (ASX: GOR) share price is up 8.04%. That's up there with the best intraday performance, at the time of writing, of any S&P/ASX 200 Index (ASX: XJO) shares today.
Gold Road closed yesterday at $1.68 per share and is currently trading for $1.81 per share.
Rival ASX gold share, Resolute Mining Limited (ASX: RSG), is also shining brightly. Resolute closed yesterday at 31 cents and is currently trading for 32 cents, up 4.1%.
On a broader level, ASX gold shares are slightly outperforming the benchmark this morning, with the S&P/ASX All Ordinaries Gold Index (ASX: XGD) up 1.58%.
Why are ASX gold shares outperforming today?
The big tailwind driving ASX gold shares higher is, as you'd expect, the soaring gold price.
While gold retraced slightly overnight, an ounce of bullion is still trading for US$2,040 (AU$2,793).
That's right about near the all-time highs reached on 7 August 2020. And it's up from US$1,826 per ounce just one month ago, a gain of 12%.
Gold is classically viewed as a haven asset. And indeed, the yellow metal first saw demand surge as investors sought an inflation hedge. Gold's bull run was then spurred onwards by Russia's invasion of Ukraine.
While that's put a lot of pressure on share markets, it's gone the other way for gold, and most ASX gold shares.
"The stock market is in a messy situation right now. You are going to continue to see selling pressure and that is also bullish for the metal," said Jim Wyckoff, senior analyst at Kitco Metals (courtesy of Reuters).
And should Russia's war in Ukraine escalate, it could see gold march higher still.
Shortly before gold topped US$2,000, Carsten Menke, analyst at Julius Baer, said:
The severity of the war in Ukraine and the uncertainty around its future trajectory have fuelled broad-based gold buying from safe-haven seekers, pushing prices towards $2,000 per ounce.
A further escalation would likely lift prices further. The latter would likely have a more lasting impact, as it could push the world economy towards a stagflation scenario, which we see as very bullish for gold.
But as mentioned up top, it's not just the Russian invasion of Ukraine supporting higher gold prices and ASX gold shares. Investors are well aware that long-dormant inflation looks to be awakening. Quickly.
According to David Meger, director of metals trading at High Ridge Futures (quoted by Reuters):
The combination of roaring energy prices, grain prices, base metal prices is culminated in dramatic inflationary pressures that continue to be the major underlying support behind gold moves higher.
How have these 2 gold producers been performing?
With gold prices within a whisker of breaking into new highs, many ASX gold shares have been making hay.
Resolute Mining, however, has not been among those. Despite today's lift and the rocketing gold price, the Resolute share price is down 1.6% over the past month. That's in a month that saw the ASX Gold Index shoot up 20.95%.
Gold Road Resources, on the other hand, outperformed even this lofty benchmark.
The ASX 200 gold share is up 28.93% since the closing bell on 9 February.