Market Insight | Gold stocks collectively fell, CHINAGOLDINTL dropped more than 5%, deteriorating expectations of recession putting pressure on gold prices
Gold stocks collectively fell. As of the time of publication, CHINAGOLDINTL fell by 5.15% to HKD 41.4; Shandong Gold fell by 4.26% to HKD 16.16; Lingbao Gold fell by 4.25% to HKD 3.38; and Zijin Mining fell by 1.29% to HKD 15.36. On the news front, the U.S. ISM Manufacturing PMI fell significantly below expectations, with the unemployment rate unexpectedly rising to 4.3%, reaching a post-pandemic high. This triggered the Sam Rule, where recession trades outweigh rate cut trades. Last Friday, gold prices fell sharply after reaching a high. Institutions believe that the short-term volatility in precious metal prices is more due to profit-taking by trading funds. They still see the investment value of precious metals under the expectations of rate cuts and the long-term weakening of the U.S. dollar credit. Huayuan Securities believes that in the short term, we are still in the early stage of expecting a trade recession. Confirmation of the recession will require more data. Next week, U.S. data will be in a vacuum period, and it is expected that the expectation of a trade recession will gradually cool down, with buying interest returning and gold prices gradually stabilizing and rising. In the long term, the bank believes that with the dual easing of U.S. monetary and fiscal policies, the contraction of U.S. dollar credit, and the background of geopolitical disturbances, gold will be in an upward trend in the medium to long term
According to the information from Zhitong Finance APP, gold stocks collectively fell. As of the time of publication, CHINAGOLDINTL (02099) fell by 5.15% to HKD 41.4; Shandong Gold (01787) fell by 4.26% to HKD 16.16; Lingbao Gold (03330) fell by 4.25% to HKD 3.38; Zijin Mining (02899) fell by 1.29% to HKD 15.36.
On the news front, the US ISM Manufacturing PMI fell significantly below expectations, with the unemployment rate unexpectedly rising to 4.3%, reaching a post-pandemic high. This triggered the Sam Rule, where recession trades outweigh rate cut trades. Last Friday, after reaching a high, the gold price fell sharply. Institutions believe that the short-term volatility in precious metal prices is more due to profit-taking by trading funds. They still see the investment value of precious metals under the expectations of rate cuts and the long-term weakening of the US dollar credit.
Huayuan Securities believes that in the short term, we are still in the early stage of expecting a trade recession, and more data is needed to confirm the recession. Next week, US data will be in a vacuum period, and it is expected that the expectation of a trade recession will gradually cool down, with buying returning and gold prices gradually stabilizing and rising. In the long term, the bank believes that with the dual easing of US monetary and fiscal policies, the contraction of US dollar credit, and the background of geopolitical disturbances, gold will be in an upward trend in the medium to long term