Gold, however, is still waiting for a catalyst which could come if the U.S. President, Donald Trump, acts on his plan to sack the head of the U.S. central bank, Jerome Powell.

Interesting as the Trump effect is on financial and commodity markets, investors are concerned about the lack of clear direction, best seen in flat overall stock markets with New York down 0.2% over the week and a 0.5% rise in Australia.

Big Dutch bank ING told clients this week that “the gold rally has stalled and is in need of a fresh catalyst to help push it higher”.

The possible sacking of Powell, who has become a human road block thwarting Trump’s demand for a major reduction in interest rates, could be the catalyst, though it could also unleash the inflation which no-one wants.

A warning that global markets might be heading for a correction came in a Bank of America survey which found that investor cash levels had dropped to a 12-year low of 3.9% of their total funds, indicating full investment, which is a proven “contrarian” sell signal.

Of greatest concern is the speed at which markets have flipped from deep pessimism to over-confidence, as seen in the “fear and greed” index of the CNN television network which rose this week to “extreme greed”.

The mix of good and bad news left markets finely balanced just as Australian stocks entered their annual reporting season, led by Rio Tinto’s upbeat production report and choice of Simon Trott, an Australian with deep mining roots, as its chief executive.

The new man inherits control of the world’s second biggest miner at an interesting time with multiple challenges but no doubt thankful to see the iron ore price move back above US$100 a tonne while copper in the U.S. is hanging on to a near record price of US$5.48 a pound.

That copper price is not expected to stick for much longer having been driven up by Trump’s 50% tariff on metal imported into the U.S., delivering US$300 million in windfall profits for metal traders who are forecasting a rebalancing of the market as the tariff effect passes through.

The iron ore increase, which lifted Rio Tinto by a marginal 0.5% to $111.49, failed to save Fortescue from a modest 0.1% slip to $16.92, with those essentially neutral share prices a useful measure of the market at what could be approaching a tipping point.

Rare earth stocks, as mentioned earlier, had a bumper week thanks to the U.S. Government investing directly in MP Materials, that country’s only producer of the exotic metals used in commercial and military technologies, as well as offering a guaranteed price and offtake deal.

MP on the New York Stock Exchange rose by 22% this week to US$58.55, taking its rise over the past month to 69%, driven by investors following the government into the stock as well as watching technology leader Apple invest in MP.

Australian stocks exposed to rare earths rose, but not as sharply as might have been expected. Sector leader Lynas added 23c to $9.76. Hastings gained 1.5c to 30c. Arafura put on 1.2c to 21c while Australian Rare Earths led the way with a rise of 2.9c (50%) to 8.6c, earning a speeding ticket from the ASX in the process.

Other rare earth moves, including some from rarely mentioned companies included: Osmond Resources, up 3.5c to 92c. Brazilian Rare Earths, up 0.4c to 1.5c. RareX, up 0.8c to 2.7c before going into a trading halt, and Iluka, up 21c to $4.97 as interest in its rare earth plans start to supersede its titanium mining operations. Macquarie is tipping an Iluka price of $6.50.

Gold stocks are having a mixed time as investors try to guess which way the metal might move next. The ASX gold index rose by 1.2% over the week, but it’s down 12.7% on a monthly basis.

The most interesting move in gold was a $50 million investment by iron ore miner Mount Gibson in a half-share in the Central Tanami joint venture, a move which reflects the need to find a new business to replace the largely worked out Koolan Island iron ore mine. Investors like the move into gold, lifting the stock by 4.7c to 34c.

The rest of the gold sector was neatly split between explorers and early stage miners which rose, and established producers which fell, a classic case of it being better to travel than to arrive. Explorers rising included:

  • WIA Gold added 2c to 28c after reporting an increase to 2.93 million ounces in the resource at its Kokoseb project in Namibia.
  • Minerals 260, up 0.5c to 12c after updating its pre-feasibility study for the Bullabulling project in WA. Bell Potter is tipping a target price of 28c.
  • Lefroy Exploration, up 2c to 12c after announcing funding for the development of its Lucky Strike project in WA.
  • Santana Minerals, up 4.5c to 59c after reporting new high-grade gold assays up to 4.1 grams a tonne over 21.7 metres at its Rise and Shine project in New Zealand, and
  • West Coast Silver, up 2.8c at 11c after reporting a 21m intersection assaying 1047g/t of silver from its Elizabeth Hill project in WA.

Gold producers lagging the explorers included:

  • Northern Star, down 50c to $16.44 as investors grow wary of rising costs. UBS downgraded its price target from $23 to $17.60.
  • Evolution Mining, down 8c to $7.46 with rising costs the same issue as Northern Star. Morgans lowered its price target from $7.40 to $7. RBC went further with a target of $6.70.
  • Genesis, down 14c to $3.97 despite record June quarter gold production, and
  • Kingsgate, down 12c to $2.39 despite reporting strong June quarter production of 20,278 ounces of gold.

Copper stocks faded as the effect of Trump’s tariffs wore off and the U.S. copper price started to retreat closer to the London price.

FireFly Metals slipped 2c lower to $1.13 despite reporting high grade assays from infill drilling at its Green Bay project in Canada. Sandfire was 32c weaker at $10.89 though Macquarie is sticking with a price target of $12, and Capstone lost 49c to $8.54.

Uranium stocks rallied despite minimal movement in the price of their metal and perhaps due to speculation that it will be the next commodity to be “Trumped” as the U.S. moves to expand its production of nuclear powered electricity. Moves included:

  • Paladin, up 90c to $7.92 with Bell Potter tipping a target price $9.20 ahead of the company’s June quarter report.
  • Boss Energy up 15c to $3.79.
  • Pioneer Lithium, up 4c to 14c thanks to the expansion of the exploration footprint at its Botsalano uranium project in Botswana.
  • Lotus, up 1c to 18c after announcing the hot commissioning of the ore processing mill at its Kayelekera project in Malawi. Bell Potter has a target price of 35c, and
  • Bannerman Energy, up 32c to $3.04 after raising $85 million to finalise work on its Etango mine in Namibia.

Other news and moves of interest this week included:

  • Agrimin, up 2.5c to 10c ahead of Friday’s listing of its spin-off Tali Resource.
  • Sun Silver, up 18c to 98c after reporting wide zones of antimony at its Maverick Springs silver and gold project in Nevada.
  • Kingsland Minerals up 4c to 12c after reporting rutile and gallium in its Leliyn graphite project in the Northern Territory.
  • Anson Resources, up 3c to 9.2c as investor interest grows in its Green River lithium brine project in Utah, and
  • Canyon Resources steady at 26c after reporting the start of site works at its Minim Martup bauxite project in Cameroon.