Understanding the Market | Gold stocks' gains expanded in the late trading session, gold futures broke through $3,300, institutions say the scissor difference of gold stocks is converging, welcoming a window period
Gold stocks expanded their gains in the closing hours, with CHIFENG GOLD rising 20.58% and DRAGON MINING rising 16.21%. COMEX gold broke through USD 3,300 per ounce, and UBS and Goldman Sachs raised their gold price forecasts to USD 3,500 and USD 3,700, respectively. Tianfeng Securities pointed out that the valuation of gold stocks is at the 20th percentile over the past five years, and market confidence in gold companies has strengthened, leading to a window period for the "scissors gap" of gold stocks to converge
According to the Zhitong Finance APP, gold stocks saw an expanded increase in the late trading session. As of the time of publication, CHIFENG GOLD (06693) rose by 20.58% to HKD 31.05; DRAGON MINING (01712) rose by 16.21% to HKD 3.37; Zhaojin Mining (01818) rose by 7.82% to HKD 19.3; and Shandong Gold (01787) rose by 7% to HKD 24.45.
On the news front, on April 16, COMEX gold prices increased by 2%, breaking through USD 3,300 per ounce, setting a new historical high. UBS raised its gold price forecast to USD 3,500 per ounce; Goldman Sachs reported an increase in its gold price forecast for the end of 2025 to USD 3,700 per ounce, stating that in extreme cases, gold could reach USD 4,500 per ounce; JP Morgan also indicated that gold prices could reach USD 4,000 "sooner than expected."
Tianfeng Securities released a research report stating that the current valuation of gold stocks is at the 20th percentile over the past five years, indicating that the sector has both space and momentum for recovery, and the "scissors gap" for gold stocks is converging, creating a window period. The report pointed out that Trump's significant tariff increases globally have heightened market concerns about the risks of a U.S. economic recession and U.S. debt repayment risks. As the U.S. dollar index declines rapidly, the market is forming a consensus on the narrative of weakening U.S. dollar credit, and the end of the divergence in gold prices has opened up valuation space for gold companies. With gold prices rising significantly, the performance growth of gold stocks is likely to achieve greater heights and durations, enhancing market confidence in investing in gold companies
