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Gold price fell sharply on Monday morning as investors continued to ditch exposure to the precious yellow metal, which is having its status as a safe-haven trade tested amid the ongoing war in Iran.
The recent move lower inevitably has second-order effects on miners, whose market values soared before the war as gold prices skyrocketed.
Mining companies are among the most volatile stocks, typically acting as a leveraged bet on the gold price, rising during a commodities bull run and falling further during a sell-off. Since the war, the price of gold has fallen, lowering miners’ revenues, and the oil and gas supply shock has boosted energy prices, raising their costs.
Before the conflict, they had enjoyed remarkable gains as the gold price soared to all-time highs of over $5,500 per ounce. The gold spot price has fallen by around 25% from its peak at the end of January and was last seen trading at $4,250 as of 6:05 a.m. E.T. on Monday.
