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The precious metal was up a further 0.5% to trade at around $1,609.61 per troy ounce (/
Gold typically performs well during flights from
However, the recent surge continued on Wednesday despite
“While interest rates are low, you need to own stocks so you need to go out there and invest your money, but you also need to have a hedge, an alternative if things don’t go so well, and I think that is why gold is benefiting as a consequence of that,” he told CNBC’s “Capital Connection” Wednesday.
“It is probably not benefitting from actual Chinese demand at this point in time, so I think it is more about portfolio positioning.”
Advancing to $1,700 this year
Citi commodity strategists also projected fresh nominal highs of $2,000/
“The set-up in gold options markets and call skew is reminiscent of 2010/2011, when gold last traded to $1,800-1,900/
“Meanwhile, gold net long positioning — when normalized for the expanded asset base — is at only half the levels of the 2011 peak.”
While acknowledging that a slowdown in physical demand in Asia, particularly jewelry sales, provides some downside risk, Citi analysts suggested that this would likely be offset by investor inflows and central bank gold buying.
Fragile equity bull market
“If you look at the composition of the U.S.
Goldman Sachs highlighted this week that outside of the big five tech giants — Facebook, Amazon, Apple, Microsoft and Alphabet — earnings growth on the S&P 500 is flat.
“What we like to see in a healthy market is broad-based buying across the board. We are starting to see that thematic playing out in Australia as well, with a number of these select go-to stocks driving the market, whereas there is a lot of choppiness under the surface,” Gerrish said, adding that U.S.