Newmont (NYSE:NEM) shares gained 1.5% to $123.63 in pre-market trading as gold prices recovered towards $4,300 per ounce following an initial decline after the Federal Reserve’s latest interest rate increase.
The US central bank raised its benchmark rate by 25 basis points on 16 September, bringing the federal funds target range to 3.75%–4.00%. The decision marked its first rate increase in three years.
Gold initially came under pressure as the US dollar strengthened following the announcement. Bullion subsequently recovered part of its losses, providing a more supportive backdrop for gold mining shares.
Newmont’s advance also followed price target increases from UBS and RBC Capital.
UBS and RBC Capital Raise Newmont Price Targets
UBS increased its price target on Newmont to $155 from $120 while maintaining its Buy rating.
The bank highlighted Newmont’s shareholder return policy, under which the company aims to distribute 100% of free cash flow when its net cash position is between $1 billion and $3 billion.
UBS also pointed to the potential for continued share repurchases to increase gold-equivalent production on a per-share basis.
RBC Capital raised its price target to $155 from $135 and reaffirmed its Outperform rating.
The revised targets followed developments in Newmont’s capital allocation strategy and the resolution of a longstanding dispute involving the Fourmile project.
Fourmile Dispute Resolution Removes Project Uncertainty
Newmont’s settlement of its dispute with Barrick Mining over the Fourmile project has resolved an outstanding issue affecting the company’s project interests.
The development comes alongside Newmont’s existing $6 billion share repurchase programme and reported cash position of approximately $9 billion.
These figures provide context for the company’s financial position and its ability to pursue shareholder distributions.
Gold Market Adjusts to Federal Reserve Rate Increase
The broader US equity market also moved higher, with the S&P 500 gaining 0.9% and the Nasdaq advancing 1.1%.
However, the Federal Reserve’s updated interest rate projections indicated that 16 of its 18 officials expected at least one additional increase before the end of 2026.
Further rate increases could affect gold prices through their impact on the US dollar and bond yields, although the direction of bullion will also depend on other market conditions.
Newmont’s shares traded at $123.63 in pre-market activity, within their reported 52-week range of $76.05 to $135.29.
The share price increase coincided with the partial recovery in gold, the two analyst price target upgrades and broader gains in US equities.
Newmont stock price
