The following is an excerpt from Canaccord Genuity’s Morning Coffee newsletter.
Gold and gold stocks suffered from renewed selling pressure in the second half of March. This should not come as a surprise to investors, considering the strong year to date gains and the seasonality turning unfavourable in the second quarter.
That said, Canaccord Genuity Portfolio Strategist Martin Roberge believes those investors who have been sitting on the sidelines should consider building benchmark positions through what could be a churning phase in Q2.
Roberge notes the historical performance of gold and gold equities following a calendar year when gold dropped at least 10% and says gold stocks normally take a breather in the second quarter before a stellar second half.
The potential rally in the second half is very powerful since, contrary to Q1, gold prices advance and support gold equities.
The Canaccord Genuity Precious Metals teams’s preferred names include:
Asanko Gold Inc. (
TSX: T.AKG,
Stock Forum),
B2Gold Corp. (
TSX: T.BTO,
Stock Forum),
Dalradian Resources Inc. (
TSX: T.DNA,
Stock Forum),
Fortuna Silver Mines Inc. (
TSX: T.FVI,
Stock Forum),
Goldcorp Inc. (
TSX: T.G,
Stock Forum),
Premier Gold Mines Ltd. (
TSX: T.PG,
Stock Forum),
Primero Mining Corp. (
TSX: T.P,
Stock Forum) and
Tahoe Resources Inc. (
TSX: T.THO,
Stock Forum).