Despite Big Merger, Investors Still Cautious on Gold Mining Companies

By Anonymous

Merger of Barrick Gold and Randgold draws muted reaction, highlighting the skepticism that Wall Street still holds for the North American gold sector

The mixed reaction to Monday’s gold-mining megamerger underscores the challenges facing the North American gold sector, where shares have tumbled this year to discounts rarely seen outside significant market downturns.

Investors heartily applauded Barrick Gold Corp.’s agreement to buy Randgold Resources Ltd. for $6 billion in stock. Shares of Barrick rose 6% and Randgold climbed 7%.