Own Newcrest shares? Here’s how the share price performed in April

We check the performance of the gold miner’s shares over the last month.

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Key points

  • Newcrest shares remained flat for the month of April
  • The company reported a strong third-quarter update but its shares fell due to the declining price of gold
  • The Reserve Bank of Australia is likely to raise interest rates tomorrow which could put more downward pressure on the yellow metal

The Newcrest Mining Ltd (ASX: NCM) share price moved in circles last month, registering nil gains for the period.

Indeed, it was a disappointing finish, considering its shares touched a near 52-week high of $28.96 on 19 April.

Investors clearly have mixed feelings when it comes to deciding the value of Newcrest shares in the current climate.

The gold miner released its quarterly production report to the ASX late last month, upgrading its FY22 guidance. However, this wasn’t enough to excite the market which led shareholders to sell off the company’s shares.

Over the past week, Newcrest shares have fallen more than 6%, despite finishing 0.6% higher to $26.88 on Friday.

What happened to Newcrest shares last month?

While the company provided a robust trading update, the price of gold recently cooled, causing Newcrest shares to sink.

The yellow metal dropped 1.45% over the month to close at US$1897.35 an ounce.

This is a stark contrast to when gold was fetching as high as US$2,070.13 an ounce on 8 March.

The Russian war in Ukraine caused a steep hike in gold prices in the short term. And with potential interest rate hikes around the corner, this is having a negative effect on the safe-haven asset.

Traditionally, rising interest rates drag down the price of precious metals and it appears investors are bracing for impact.

The major banks are predicting that the Reserve Bank of Australia could lift interest rates as high as 1.50% in 2022.

Annual inflation has soared to 5.1%, the worst in the last 20 years which has led to escalating living costs.

Investors will have to wait and see until tomorrow if the Reserve Bank of Australia starts lifting the cash rate.

If this does happen, it will be the first increase in almost 12 years from the governing body.

About the Newcrest share price

Over the last 12 months, the Newcrest share price is relatively flat, with year to date up almost 10%.

On valuation grounds, Newcrest commands a market capitalisation of approximately $24.01 billion.

Motley Fool contributor Aaron Teboneras 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 Scott Phillips.

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