There is news this morning that IAM GOLD has completely suspended its dividend. Unlike Barrick and Newmont, which both REDUCED their dividend payments earlier this year, IAG has done away with altogether.
News like this never serves a sector well which has already been beaten up so badly. Coming at a time in which it appeared some of the mining stocks were attempting to cement a bottom, it could not have been worse.
In a note to clients, Goldman analysts noted that IAG has one of the highest cash costs in the sector ($1200).
Unfortunately the entire sector is getting hit hard again today. Barrick, which just this week looked as if it was ready to bottom, has now fallen back into that Monday gap on the charts and completely closed it and then some.
Meanwhile, the HUI has now made a new low for this move down. It has scored a new 52 week low and is actually trading below the MONTHLY CLOSING PRICE made back in October 2008.
Let's see what the rest of the day brings. There is still a chance that the index and some of the respective miners could stage a late session move higher. That would be a hugely positive sign. If not, well... not much more needs to be added.
"When misguided public opinion honors what is despicable and despises what is honorable, punishes virtue and rewards vice, encourages what is harmful and discourages what is useful, applauds falsehood and smothers truth under indifference or insult, a nation turns its back on progress and can be restored only by the terrible lessons of catastrophe." … Frederic Bastiat
Evil talks about tolerance only when it’s weak. When it gains the upper hand, its vanity always requires the destruction of the good and the innocent, because the example of good and innocent lives is an ongoing witness against it. So it always has been. So it always will be. And America has no special immunity to becoming an enemy of its own founding beliefs about human freedom, human dignity, the limited power of the state, and the sovereignty of God. – Archbishop Chaput
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