Precious Metals, Miners Suffer After Bernanke's Good News


Precious metals and the broader market headed in opposite directions Wednesday, with gold taking its biggest single-day dive in two-and-a-half months as a February full of good economic news helped drive the price of precious metals down on the day and month as a whole.

Gold and silver mining companies took a hit Wednesday after U.S. Federal Reserve Chairman Ben Bernanke expressed optimism about the U.S. job market.

Bullion fell $80 from its high on the day, with gold for April delivery falling $77.10 to $1,711.30. The 4.3 percent drop on the most active contract on the Comex is the metal's biggest one-day price drop since mid-December.

In contrast, U.S. stock indexes fell slightly Wednesday but ended the month up. The Dow Jones Industrial Average fell 0.4 percent, closing at 12,925.07, but was up 2.5 percent for the month. The S&P 500 Index fell 0.47 percent to 1,365.68 but enjoyed a 4.1 percent gain on the month.

Major gold and silver mining companies took a dive across the board, with losses of almost 7 percent in some cases. Barrick Gold ( ABX ) fell $1.88 to $47.58, taking a dive shortly after Bernanke's comments around 10 a.m. Goldcorp ( GG ) dropped $1.55 to $48.48. Newmont Mining ( NEM ) also fell $2.61 to $59.39.

Silver miners suffered a tough day, taking a similar plunge around 10 a.m. Coeur d'Alene Mines ( CDE ) fell $1.88 to $28.34. Hecla Mining ( HL ) fell 0.32 cents to $5.06. First Majestic Silver (AG) also dropped $1.34 to $20.43.

"(Bernanke's) statement that employment is recovering at a better-than-expected rate implies that if quantitative easing is coming, it won't be for a while," said Steve Scacalossi, director of global precious metals at TD Securities, according to Reuters .

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of The NASDAQ OMX Group, Inc.

This article appears in: Investing , Commodities

Referenced Stocks: ABX , CDE , GG , HL , NEM

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