Optimism on the Cost Front for Gold Stocks

BARRY COOPER, CIBC World Markets (10/27/2008)
"A myriad of complex factors should continue to add to the earnings uncertainty for metal stocks in both Q3 and Q4. Financial volatility will be affected by violent currency movements coupled with provisional pricing adjustments and eventually changes to treatment and refining charges.

Gold stocks appear to have priced in the worst scenarios yet we see room for optimism on the cost front for the first time since 2002. We expect that beta to bullion responses will return to gold shares although perhaps not to the levels seen in the late 1990s."

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