Dallas, Texas 01/29/2014 (FINANCIALSTRENDS) – Barrick Gold Corporation (USA) (NYSE:ABX) has been one of the early movers at the markets during trading on 28th January. This upward movement in the stock of the $21.9 billion market capped gold mining firm by close to 1.4 percent was in tandem with the 1.28 percent surge affected by the larger basic metals index yesterday. The improvement in the market sentiments for the gold firms can be linked to the reports of huge increase in the demand for the yellow metal in the Chinese market over the last few weeks, in the run up to Chinese New Year celebrations with analysts pegging the growth in demand from China for gold going up by a hugely impressive 20 percent in 2013. The international gold producer’s guild has reported that in the past year, the Asian giant has surged past traditional top gold importer India which has taken many steps in recent times to cut down on its gold import to manage its current account deficit.
These latest reports of pickup in demand from China comes as a balm for frayed nerves of investors in Barrick Gold Corporation (USA) (NYSE:ABX), since the firm had just last week announced that it would be using a lower price bench mark to calculate its estimated gold reserves in the light of continued dip in demand and price of gold in the international markets. Thanks to this re-pricing exercise on part of the $21 billion market capped mining firm, a small but significant portion of its “in the ground” gold had emerged uneconomical to mine at current gold valuation.
Barrick Gold Corporation (USA) (NYSE:ABX) CEO Jamie Sokalsky has warned that this move might result in asset restatements and had been quoted to have said that, “We’ve taken a conservative approach this year and we’re going to value our reserves at $1,100 per ounce as well as running the mine plans at $1,100 per ounce.”