China, Fed, BOJ, ECB all give reason to ask Santa for Gold this Christmas and possibly gold miners for the brave children who have been good this year. China PMI last night reaffirms what we have been saying at EmergingMoney.com: “NO HARD LANDING”.
Great technical breakout (nailed by Tom DeMark) and a view that China can truly lead emerging markets higher, but gold can be a bigger factor than a it has been in the first leg of this recent emerging market outperformance run.
There have been technical factors that have held gold up at resistance levels of $1,718 and at $1,725 coupled with solid institutional selling but it seem to be dissipating.
Gold will achieve its 12th straight annual gain! Amazing rally that doesn’t have to be 20% year to be important to your portfolio, but also to the underlying miners with many of them no longer hedging gold price.
Miners have been a terrible trade for last 3 months but valuations are the ultimate backstop.
When something gets so cheap that you say “OMG I can’t believe its trading here” Gold Fields Ltd (GFI, quote) gives you 3.3% div yield and trades at 9.5x current P/E with ’13ePE @ 6.6x.
This company has a 5yr average PE of 21.