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Stock market crash: I think this FTSE 100 share and its 8% dividend yield are too good to miss!

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It’s been a tough couple of days for UK shares as fears of fresh Covid-19 lockdowns have caused indices to plummet.

It’s not just global stock markets that have had an awful couple of days though. Precious metals have sunk because of surging demand for the safe-haven US dollar. This scenario makes it more expensive to buy an ounce of gold, or whatever your poison. And, as a consequence, the yellow metal has dropped back below the technically-critical $1,900 per ounce marker.

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A FTSE 100 faller

Bullion’s now a long way from recent record highs around $2,075 per ounce. And it’s in danger of falling further in the near term should it retreat below key support around $1,900. Indeed, the experts at Credit Suisse reckon gold could drop as low as $1,726 per ounce should consolidation fever persist.

Unsurprisingly, gold’s descent has played havoc with investor appetite for gold-producing UK shares. FTSE 100 mining colossus Polymetal International (LSE: POLY) for instance has just dropped 12% in value in less than a week. Like gold, it’s now trading at its cheapest for since the middle of July. While more near-term weakness could be on the cards, I think buying precious metals diggers like this remains a terrific idea.

Go for gold

Make no mistake, the gold price outlook beyond the immediate future remains extremely bright. Why? Well, there’s a sea of intense macroeconomic, geopolitical and social tensions that should help safe-haven demand for the yellow metal rebound strongly.

According to analyst John J Hardy of Saxo Bank, some of the issues that have recently helped global gold-backed ETF holdings hit record highs include “a dimming outlook for further US fiscal stimulus, rising Covid-19, US-China tensions and potential increased volatility around the presidential election.”

Credit Suisse certainly believes gold prices will fight back strongly. Sure, they may fall back towards $1,700 per ounce before long. But the bank reckons the hard currency will soar to new record peaks above $2,075 eventually. And, in the long term, Credit Suisse reckons gold will even soar as high as $2,700 per ounce.

A UK share with 8% dividend yields

This is why I believe buying gold-producing UK shares makes serious sense. Not only can investors ride a rising gold price, but they can also grab hold of some truly-terrific dividends in the process. Polymetal, for one, carries a stunning 5.7% dividend yield for 2020. It’s a reading that marches to 8% for next year too.

This spectacular yield isn’t the only reason why Polymetal’s such a terrific buy. With City analysts forecasting a near-70% rise in annual earnings in 2020, the UK share trades on a price-to-earnings (P/E) ratio of just 11 times.

This FTSE 100 stock’s a great buy for growth, income and value investors then. But it’s not the only UK share that’s too cheap to miss right now. You can find even more top stocks by browsing The Motley Fool’s epic catalogue of special reports. So do some research and invest today.

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Royston Wild has no position in any of the shares mentioned. The Motley Fool UK has no position in any of the shares mentioned. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors.

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