Understanding the Market | Gold stocks rose across the board today as gold prices surpassed $2,890, setting a new historical high. The central bank has increased its gold holdings for three consecutive months
Gold stocks rose broadly today, with ZHAOJIN MINING up 4.01%, LINGBAO GOLD up 2.92%, and ZIJIN MINING up 2.8%. The spot gold price has surpassed USD 2,890 per ounce, setting a new historical high, with an increase of over 10% this year. The People's Bank of China has increased its gold holdings for three consecutive months, which is expected to drive up gold prices. Galaxy Securities analysis suggests that the Federal Reserve's interest rate cuts, geopolitical conflicts, and U.S. debt issues will continue to impact the gold market. The Financial Regulatory Administration has allowed insurance funds to invest in gold, which is expected to bring an additional nearly 200 billion yuan in funds, further pushing up gold prices
According to Zhitong Finance APP, gold stocks saw a broad rise today. As of the time of publication, ZHAOJIN MINING (01818) rose by 4.01% to HKD 14.54; LINGBAO GOLD (03330) increased by 2.92% to HKD 4.94; ZIJIN MINING (02899) was up by 2.8% to HKD 16.16; and Shandong Gold (01787) rose by 2.39% to HKD 16.28.
In terms of news, on February 10, spot gold surpassed USD 2,890 per ounce, reaching a new historical high, with an increase of over 10% this year. Previously, the People's Bank of China announced the official reserve asset situation as of the end of January 2025, indicating that gold reserves have increased for the third consecutive month. Galaxy Securities believes there are three main mid-term logics for the rise in gold prices: the global gold ETF funds increasing their gold holdings under the Federal Reserve's interest rate cuts, central bank gold purchases influenced by geopolitical conflicts, and continued hedging trades against credit devaluation caused by U.S. debt issues, all of which will drive gold prices higher.
It is worth mentioning that on February 7, the Financial Regulatory Administration issued a notice on the pilot program for insurance funds to invest in gold. Starting from now, 10 pilot insurance companies can conduct gold investment business for medium to long-term asset allocation purposes. According to estimates, this could bring nearly 200 billion yuan of incremental funds to the gold market, potentially further boosting gold prices and promoting the prosperous development of China's gold market. Citigroup previously indicated that further tariff escalations would lead to bullish sentiment on gold within 6-12 months, with gold prices expected to rise to USD 3,000 per ounce