Gold equities lagging gold, silver prices so far this year

Investing.com -- Gold prices have outperformed silver in the third quarter of 2024, yet gold equities have lagged behind both metals year-to-date, according to Bank of America analysts.

In Q3 2024, gold prices rose by 14%, hitting an all-time high of $2,672 per ounce on September 26. In contrast, silver prices climbed by 8%, though they remain 1.7% below their 2024 peak of $32 per ounce, which was reached in late May.

BofA attributes silver’s underperformance to weaker industrial demand. Gold’s strong quarter was said to be fueled by central bank purchases and Asian consumer buying, along with a shift in global gold ETF flows, which moved from selling to buying as the U.S. Federal Reserve delivered its first rate cut in years.

Despite the positive performance of the metals, BofA says gold equities have underperformed. Year-to-date (YTD), gold has gained 29% and silver 33%.

However, the bank notes that the S&P/TSX Global Gold Equity Index is up only 32%, and the Philadelphia Gold and Silver Equity Index (XAU) has risen 29%, both down 3% from their late September peaks.

Top-performing gold equities include IAMGOLD (NYSE:IAG ), which surged 109%, New Gold (NYSE:NGD ) (+103%), Kinross Gold (NYSE:KGC ) (+56%), Agnico Eagle (NYSE:AEM ) Mines (+49%), and Alamos Gold (NYSE:AGI ) (+48%), said BofA. In contrast, underperformers include SSR Mining (NASDAQ:SSRM ) (-45%), B2Gold (NYSE:BTG ) (+1%), Endeavour Mining (+7%), Barrick Gold (NYSE:GOLD ) (+12%), and Franco-Nevada (+13%).

Mid-tier gold equities gained momentum in Q3 2024, with the S&P/TSX Global Gold Equity Index and XAU both rising 18%. Meanwhile, BofA stated that New Gold led with a 52% gain, followed by IAMGOLD (+41%) and SSR Mining (+32%). Underperformers included Franco-Nevada (+6%) and Triple Flag Precious Metals (+6%).

Overall, while precious metals have rallied, gold equities have struggled to keep pace, particularly earlier in the year.

Source: Investing.com