Canada's composite index TSX started 2020 with gains as stocks rose to all-time highs on Thursday as the strong rally in 2019 was set to continue in the first trading day of the New Year. The latest performance of the index is a mark of a strong upcoming year, possibly the best since the global financial crisis, powered by returning confidence in the global economy in the wake of an imminent U.S.-China trade truce and hopes of a smooth Brexit.
Gold markets powered higher with gold prices hiking $9.30 at $1,532.40 U.S. an ounce. The materials sector, which includes precious and base metals miners and fertilizer companies, rose 0.1%, with gold futures rising 0.07%.
The price of gold is projected to increase to US $1,750 through 2020. By 2021, the projected price is US$1,925. Some analysts believe gold is being supported by uncertainty over the U.S.-China trade deal while others view the volatility in markets ahead of the elections and the pending impeachment trial of President Donald Trump as catalysts for movements in the price of gold.
Stocks of several Canadian junior gold miners were among the top-100 performing stocks heading into 2020. Alacer Gold (TSX:ASR) is highlighted by industry analysts as the next long-term investment prospect. It has the makings of a sustainable multi-mine producer with substantial holdings in a mine in Western Asia. The Alacer gold producer is the second-top performer on the TSX as of December 16, 2019. The gain of this gold stock so far is 170.24%.
Another promising name on the market is Canadian-based Detour Gold with a cost per ounce of gold of $1,005. The cost per ounce is higher than the cost per ounce for Barrick’s, but Barrick has higher debt and more exposure to geopolitical risks. Investors’ interest in Detour is fuelled by the company’s zero exposure to foreign markets, next-to-nothing debt, and stock performance.
Wheaton Precious Metals Corp (TSX:WPM) was able to demonstrate a five-year return of 53.34% and a dividend of 0.99% at the end of 2019. The gold miner is headquartered in Vancouver, has a market capitalization of $16.3 billion, and is one of the world’s largest precious metals streaming companies. The company has agreements with 19 mines and nine development-stage projects.
All of these gold producers are a good buy for those looking to invest in gold and precious metals without having to decide which mine will be profitable that year. Some of these companies have interests in both gold and silver mines.
Various asset classes are on pace to register impressive gains for 2019 with spot Gold, prices surging 17% year-to-date. More recently, upward momentum has begun to pick up for the aforementioned commodity and breakout signals show potential of carrying Gold, into the early trading days of 2020.