Caledonia Mining Corporation PLC (AIM:CMCL, NYSE-A:CMCL, VFEX:CMCL) and Premier African Minerals Ltd (AIM:PREM, OTC:PRMMF) led the charge in London after bullion prices rebounded, with the shares up 5% and 2% respectively.
Larger rivals joined the advance, Endeavour Mining PLC (LSE:EDV, TSX:EDV, OTCQX:EDVMF) climbing 4% and Fresnillo PLC (LSE:FRES)adding 3% as silver rose 32 cents to $42.12. Gold itself rallied $10 to $3,654.69 an ounce, reversing Thursday’s decline.
Helping lift sentiment was a note from UBS in which it told investors: "Gold stocks are no longer unloved and undervalued...but we remain bullish gold. Earnings momentum is positive and valuations undemanding."
Earlier this week, Deutsche Bank struck an increasingly bullish note on the outlook for precious metals.
Its analysts believe gold could average $4,000 an ounce next year, with silver tipped to reach $45, up from a previous forecast of $40.
One plank of the case is monetary policy. After three US rate cuts this year, Deutsche sees scope for the Federal Reserve to loosen further in 2026, despite its base case of a pause. Lower US rates typically weaken the dollar, historically the single strongest driver of gold.
Central bank appetite is another force. Official purchases, dominated by China, are running at double the pace of the decade to 2021 and could reach 900 tonnes in 2026. Supply, by contrast, is constrained: recycling is running about 4% lower than expected this year.
Positioning indicators are also not stretched. Exchange-traded funds hold about 17 million ounces less than at the 2020 peak, while speculative bets remain modest.
Risks remain. A buoyant Wall Street, with Deutsche’s S&P 500 target now 7,000, may draw capital away from defensive assets. Seasonality is another drag: the fourth quarter has historically been bullion’s weakest.
Still, with official demand strong and silver in its fifth year of physical deficit, Deutsche expects both metals to push higher into 2026.