Mine Stocks Fall With Metals Selloff

The price of precious metals sank Monday under the weight of sell orders dumped by traders who rely on technical data to guide their decisions.

Local mining stocks dropped on the selloff.

Gold dropped $5 an ounce to close at $393.90 on the New York Mercantile spot market. Silver shed 12 cents to close at $5.37 an ounce.

Large institutional holders of gold and silver reduced the percentage of precious metals in their investment portfolios, said Ted Kempf, an analyst with the CPM Group Ltd. in New York.

Gold led the charge and silver dropped “in sympathy” with gold, he said.

Such technical trading poses no reason for concern, he said.

“In the near term I think we’ll see metals prices bounce up,” Kempf said, adding that the market fundamentals for both silver and gold are too strong to justify this price weakness.

Price movements Monday of local mining stocks that trade on major exchanges:

Hecla Mining Co. dropped 25 cents to $7.88; Pegasus Gold, 88 cents to $15; Coeur d’Alene Mines Corp., $1 to $22.50; and Gold Reserve, 50 cents to $9. Sunshine Mining & Refining Co. was unchanged at $1.38.

, DataTimes