Why did the Newcrest share price pop 5% to a 2-month high?

Shares in the gold miner were surging today alongside the gold price.

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a man wearing a gold shirt smiles widely as he is engulfed in a shower of gold confetti falling from the sky. representing a new gold discovery by ASX mining share OzAurum Resources

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Key points

  • The Newcrest Mining share price soared to a two-month high on Thursday
  • The ASX 200 gold stock was lifted by positive inflation news out of the United States overnight
  • Better-than-expected inflation numbers pushed the US and Australian share markets higher today, as well as the gold price 

The Newcrest Mining Ltd (ASX: NCM) share price soared by 3.72% on Thursday to close at $27.90.

Earlier in the day, the Newcrest share price hit a two-month high of $28.19 per share, up 4.79%.

No doubt, the gold miner was lifted alongside many other ASX 200 shares by news of lower-than-expected inflation numbers in the United States.

US headline inflation fell to 3% — the lowest level in two years — stoking hopes that the US Federal Reserve will cease raising interest rates.

The Dow Jones Industrial Average (DJX: .DJI) gained 0.25% on the news. The S&P 500 Index (SP: .INX) also lifted 0.74%.  

And as we all know, what happens in the US markets tends to follow in Australia.

That's why the S&P/ASX 200 Index (ASX: XJO) closed the session up 1.56% — or 111.2 points — to 7,246.9 points.

But there's another factor at play in the Newcrest share price's two-month high today.

Newcrest share price surges on gold price rise

As with all ASX shares tied to commodities, when the value of the product rises, so does the stock.

The gold price is trading at about US$1,960 per ounce on Thursday afternoon. That's an 0.18% rise for the day and an 0.9% bump over the past month.

This is the highest gold price we've seen in more than three weeks.

Once again, US inflation data is the catalyst behind the yellow metal's surge today.

The gold price has been climbing since late 2022 and hit a recent peak of US$2,016 per ounce in May.

This is not far off the historical record high of US$2,034 reached in August 2020.

The Newcrest share price is up 34% in the year to date.

Motley Fool contributor Bronwyn Allen 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 Scott Phillips.

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