Gold Miners Among Biggest Gainers

November 30, 2012 at 07:49

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Gold miners were among the gainers as the London market reached a three-week high.

Petropavlovsk rose 1.4 per cent to 328.1p and Centamin added 6.8 per cent to 59.5p with Westhouse analysts putting “buy” recommendations on both stocks.

“We believe gold share valuations are now compelling,” it said. “Gold mining company managements are beginning to realise that to regain investor interest they must deliver, both in terms of asset management and shareholder returns.”

Poor delivery of production and cost targets over the past year meant gold equities had significantly underperformed gold over the past year, Westhouse said.

For Petropavlovsk, it saw the market pricing in a failure to deliver, in spite of the Russia-based group mostly achieving or beating targets in recent years.

Centamin has been hurt by a court ruling in Egypt last month that found its mining licence invalid.

Westhouse was encouraged by the company’s robust rebuttal and saw the weakness as an opportunity to buy.