'Thriving' ASX gold shares to see more growth in 2022: expert

Up more than 9% in 2022, gold looks well positioned to kick off another bull run.

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ASX gold shares have, as a whole, enjoyed an excellent year so far in 2022.

To give you a broad picture, the S&P/ASX All Ordinaries Gold Index (ASX: XGD) has gained 13.2% since the opening bell on 4 January.

By comparison, the All Ordinaries Index (ASX: XAO) has lost 2.2% year to date.

ASX gold shares shining bright amid rising gold prices

The common tailwind that all ASX gold shares have been enjoying is the increasing price of the yellow metal they dig from the ground.

On 4 January, when the ASX opened for the first day of trading in 2022, gold was trading for US$1,801 (AU$2,401) per troy ounce, according to data from Bloomberg. Today that same ounce is worth US$1,969, an increase of more than 9%.

That increase helped push the Evolution Mining Ltd (ASX: EVN) up 10.3% this calendar year. Meanwhile, the Northern Star Resources Ltd (ASX: NST) share price has gained 15.9% while Regis Resources Limited (ASX: RRL) shares are up 19.5% year to date.

Of course, that's all water under the bridge now.

So, what can investors expect for gold and ASX gold shares next?

"It appears gold could be about to kick off a bull trend supported by higher borrowing costs (yields), Russian tension lingering, and lockdown concerns," says Jessica Amir, Australian market strategists at Saxo Markets. "Gold has historically outperformed equities every time the Fed rose interest rates, with a suite of hikes."

In the year ahead, Saxo sees gold stocks "thriving and seeing higher earnings and share price growth".

An international gold stock to consider

Atop a broad choice of outperforming ASX gold shares, there are numerous large-cap gold stocks listed in the United States, and elsewhere.

Amir singles out Newmont Corporation (NYSE: NEM) as a gold share to consider for investors who believe gold will continue to rally.

According to Amir:

The biggest gold company in the world is arguably Newmont, which makes 86% of its money from gold, and 5% from silver. Newmont shares are trading 35% up this year, and given its 2022 earnings are expected to rise (Q1 earnings due 22 April), Newmont is one to watch.

You'd also expect the company to upgrade its outlook for 2022 for gold, supporting its income rising and earnings (EBITDA). Remember rising earnings generally supports share price growth.

Whether you're looking into ASX gold shares or international companies, keep an eye on those factors Amir pointed out that could impact the price of gold.

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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