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Gold Stocks in Johannesburg Set Pace for Best Year Since '05

Gold Stocks in Johannesburg Set Pace for Best Year Since 2005

(Bloomberg) -- It’s only June, but gold stocks traded in Johannesburg are already heading for their best year since 2005.

A South African index of bullion producers jumped as much as 6.1% on Thursday, stretching its year-to-date gain to 40%. Gold surged to the highest in more than five years after the U.S. Federal Reserve on Wednesday indicated a readiness to cut interest rates.

Gold Stocks in Johannesburg Set Pace for Best Year Since '05

The precious metal has rallied since late May as investors seek havens amid slowing global growth due to the fallout from the U.S.-China trade dispute and as central banks adopt a more dovish tone. A report that Iran shot down a U.S. drone added to Middle East geopolitical tensions -- and to bullion’s allure.

Read more here about momentum for gold prices

Gold Fields Ltd. is the best-performing Johannesburg gold stock, up 54% in 2019. The rally has pushed the sector index close to technically overbought territory, with its 14-day relative strength index rising above 70, a level that suggests gains may be overdone, in all but three of the past 14 sessions.

To contact the reporter on this story: John Viljoen in Cape Town at jviljoen@bloomberg.net

To contact the editors responsible for this story: Blaise Robinson at brobinson58@bloomberg.net, Paul Jarvis

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