Gold and defense stocks are unstoppable! Barrick Mining, Deutz, Dryden Gold

Gold above USD 3,600: Barrick Mining and Newmont strong

The price of gold has reached new record highs in recent weeks, exceeding the USD 3,600 per troy ounce mark. This development is driven by the prospect of interest rate cuts in the US and a weaker US dollar. Market observers even believe that the precious metal could reach prices of USD 4,000 to 5,000 in the coming quarters.

Gold's recent price increase was due to US unemployment figures. The unemployment rate rose noticeably recently, while job growth remained well below expectations. This points to a cooling economy and increases pressure on the US Federal Reserve to cut interest rates quickly. The market already considers a first interest rate cut in September to be almost inevitable. Since gold does not generate any current income, it benefits particularly in phases of low real interest rates. Accordingly, the combination of a weaker labor market and a monetary policy shift has significantly fueled the recent price surge.

After major gold producers struggled for a long time to keep pace with the price of the precious metal, their shares are finally picking up speed. Investor favorite Barrick Mining has already gained 50% this year and is trading above EUR 24. Newmont's share price has risen by just over 70%. This makes mining stocks among the high flyers on the global stock markets this year, eclipsing tech stocks. Investors are increasingly turning to gold as a safe haven and inflation hedge, which has a direct impact on the valuation of mining companies.

Dryden Gold: Explorer in Canada with strong results

Dryden Gold's stock begins its price rally. With a land package of more than 70,000 hectares in the Dryden Gold Belt in Ontario, Canada, and an ongoing 15,000-meter drill program, the Company is positioning itself as one of the most exciting exploration plays in the region.

When we first highlighted the high-grade drill results in July, the stock was trading at CAD 0.21. As of yesterday, it was already trading at CAD 0.265. In addition to the strong tailwind from rising gold prices, the Canadian exploration company's stock is once again being driven by spectacular results from the so-called gap drilling in the Gold Rock target zone. According to Couloir Capital, the price rally could go a long way yet. The analyst price target for Dryden Gold shares is CAD 0.65.

Drill hole DGR-25-018 intersected nine superimposed gold-mineralized structures over a length of 540 meters. Highlights include a high-grade interval of 55.34 g/t gold over 3.50 meters and, immediately below, an extremely high-grade interval of 379.00 g/t gold. At shallower depths, the team also identified a near-surface interval of 0.93 g/t gold over 9.00 meters at Big Master. CEO Trey Wasser spoke of a "much more robust gold-mineralized system with potential for open pit mining," which had been confirmed by gap drilling. According to him, the Company is now providing investors with a clearer picture of how Gold Rock is developing. More than a kilometer of strike length in the Elora system has already been explored, and the new results indicate an even larger, more complex, and higher-grade deposit.

Also promising: Geologists identified three different types of structures – from continuous shear zones to fold-related mineralization to staggered structures. Previous results, such as 301.67 g/t gold over 3.90 meters, fit into this picture.

Further news flow is expected in the coming weeks. If this trend continues, the rally could go much further.

Deutz: Into the MDAX after takeover?

Only defense stocks can keep up with the performance of gold stocks this year. Deutz recently demonstrated that the defense sector continues to be popular with investors. The Cologne-based company is one of the beneficiaries of Germany's billion-euro investments in defense and infrastructure from the second tier. The share price has more than doubled in the current year. At just under EUR 10, it is trading at its highest level since 2007. Deutz can also hope to be included in the MDAX.

The latest jump in the share price was triggered by a takeover announcement. Deutz plans to acquire SOBEK Group GmbH. The German company is active in several specialized fields of application, including motorsports, aerospace, and medical technology. It sees considerable growth potential in the drone business. SOBEK supplies leading European drone manufacturers with electric drive systems.

Analysts welcomed the takeover. Hauck Aufhäuser sees the acquisition as a clear strengthening of Deutz's defense division. The analysts reaffirm their "Buy" recommendation with a price target of EUR 11.30.

Oddo BHF also applauded the move. Although the acquisition of a component manufacturer for drones came as something of a surprise, it fits in with the strategic orientation of the Cologne-based MDAX candidate. The aim is to reduce dependence on the cyclical combustion engine business through targeted diversification. Analysts see the fair value of the share at EUR 10.40 and rate it as "Outperform."

Gold and defense continue to be unstoppable. Barrick has made strong progress in recent weeks. Now is the time for successful explorers such as Dryden Gold. The share still has room for growth. Deutz has already performed very well this year. Investors should monitor the development of the order backlog, which is expected to grow dynamically.