U.S. equities tumbled as investors took in new data signaling a slowdown in China and a report that showed an unexpected rise in U.S. crude stockpiles, fuelling concerns of a global oil surplus. The S&P 500 Index and the Dow Jones Industrial Average both fell roughly 5.8% to 1,970.89 and 16,459.75, respectively. This was the S&P’s worst weekly decline since 2011. The Nasdaq gave back 6.8% to finish at 4,706.04. Oil prices plunged below US$40 per barrel for the first time since 2009, before closing the week at US$40.45. Gold climbed nearly US$47 per oz. to US$1,160.40.
Amid the turmoil in the global markets, Arch Coal and Peabody Energy were the weekly percentage winners, soaring 206% and 58%, respectively, to finish at US$3.85 and US$1.78 per share. Word that billionaire George Soros, who once called coal the “lethal bullet” for climate change, had invested more than US$2 million in these struggling coal companies, likely sent the shares climbing. On Aug. 14, Soros Fund Management revealed that it held 553,200 shares in Arch Coal and 1.03 million shares in Peabody in the quarter ended June 30. Both firms saw their share prices increase a few days later after various media outlets broadcasted Soros’ coal investments.
Arch Coal was also the second biggest value gainer, adding US$2.59 per share. Randgold Resources topped that list, rising US$3.73 to US$65.75, on higher gold prices, which also lifted shares in Gold Fields and AngloGold Ashanti. Gold Fields rose 34% to US$3.55 per share. AngloGold climbed 30% to US$8.13 per share.
On Aug. 17, AngloGold reported it generated US$71 million of free cash flow in the second quarter, with output and costs beating guidance. During the three months ended June, AngloGold produced slightly over 1 million oz. gold at total cash costs of US$718 per oz. It had guided production of 960,000 to 1 million oz. at US$770 to US$820 per oz. Adjusted headline profit was US$26 million, or US6¢ per share, up from an adjusted loss of US$4 million, or negative US1¢ per share, a year ago.
Oil and gas producer Dejour Energy was the biggest percentage loser, retreating 23% to US9¢ per share, likely due to lower crude prices.