Here's why the Northern Star (ASX:NST) share price has lost 11% in 2 weeks

September hasn't been a great month for the Aussie gold miner…

| More on:
plummeting gold share price

Image source: Getty Images

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

The Northern Star Resources Ltd (ASX: NST) is not having a great time of it right now. Shares in the Aussie gold miner fell lower on Thursday and are now down 11% in the past fortnight.

Here's what's weighing on the company's valuation in September.

Why the Northern Star share price is down 11% in 2 weeks

The latest share price moves don't appear to be driven by any big company news. In fact, Northern Star hasn't provided any price-sensitive news since September 16 when it completed its Central Tanami Project joint venture.

Perhaps the bigger factor at play is gold prices. Whenever ASX resources shares like Northern Star are under pressure, it can pay to see what the broader market is doing as well as underlying commodities.

It's true the last 2 weeks haven't been great for the S&P/ASX 200 Index (ASX: XJO). The broad market index has edged 0.8% lower in the past fortnight weighed down by tech and resources shares.

Chief among those falling resources shares are ASX gold shares like Northern Star and Newcrest Mining Ltd (ASX: NCM). Much of those movements can be traced back to falling global gold prices.

Gold has historically been viewed as a safe haven asset. That means it has tended to be in demand, and therefore perform strongly when shares are underperforming. It's also often seen as a good hedge against inflation, which is what many investors expected we'd see a lot of in 2021.

However, that hasn't necessarily been the case. With yields rising on expectations of a sooner than expected US Federal Market Open Committee (FOMC) rate hike, gold prices are falling.

In fact, more investors have been flocking towards the US dollar for safety in recent weeks and away from gold. That has reduced demand and sent prices of the precious metal tumbling.

We've seen that reflected in the Northern Star share price of late. Shares in the Aussie gold miner are down 11% in the last 2 weeks and 36.2% for the year.

Foolish takeaway

The Northern Star share price is under pressure in 2021 and September has not been a month that investors will want to remember.

Shares in the Aussie gold miner are trading at a price to earnings (P/E) ratio of 7.4 with a 2.2% dividend yield on Thursday afternoon.

Should you invest $1,000 in Australia And New Zealand Banking Group right now?

Before you buy Australia And New Zealand Banking Group shares, consider this:

Motley Fool investing expert Scott Phillips just revealed what he believes are the 5 best stocks for investors to buy right now... and Australia And New Zealand Banking Group wasn't one of them.

The online investing service he’s run for over a decade, Motley Fool Share Advisor, has provided thousands of paying members with stock picks that have doubled, tripled or even more.*

And right now, Scott thinks there are 5 stocks that may be better buys...

See The 5 Stocks *Returns as of 6 March 2025

Motley Fool contributor Ken Hall has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

More on Gold

An older female ASX investor holds a gangster-style fist pump pose showing off gold rings with dollar signs on them.
Gold

3 reasons to buy this soaring ASX 200 gold stock today

The ASX 200 gold stock has soared 108% in a year, and this leading expert forecasts more outperformance to come.

Read more »

Woman holding gold bar and cheering.
Earnings Results

Newmont share price sees green as gold prices deliver in FY24

Things continue shining brightly for the gold miner.

Read more »

rising gold share price represented by a green arrow on piles of gold block
Earnings Results

2 ASX 200 gold shares grabbing headlines on record-setting results today

The ASX 200 gold miners delivered record profits and surging dividends.

Read more »

ASX gold share price.
Resources Shares

Goldman Sachs upgrades its gold price forecast

The gold price is currently trading 0.64% higher at US$2,899 per ounce.

Read more »

Miner looking at a tablet.
Gold

Is there any growth potential left in Evolution Mining stock?

After the gold price smashed a new record high this week, we present the views of 2 brokers.

Read more »

A cool man smiles as he is draped in gold cloth and wearing gold glasses.
Gold

The $85 billion ASX 200 gold stock trading at a 35% discount

The ASX 200 gold stock mines some 6 million ounces of gold every year.

Read more »

Gold bars and Australian dollar notes.
Earnings Results

Northern Star share price lifts off on record half-year dividend

Up 39% in a year, ASX investors are bidding up Northern Star shares again on Thursday.

Read more »

Man in mining hat with fists raised and eyes closed looking happy and excited about the Newcrest share price
Gold

This ASX small cap gold stock is rocketing 142% on new discovery

This gold explorer sees potential for a substantial resource.

Read more »