Gold ETF led the gains, Huaxia Fund gold stock ETF and Industrial Bank Rui Xin Fund gold stock ETF rose more than 3%; China Merchants Fund gold stock ETF, Guotai Fund gold stock ETF, Yongying Fund gold stock ETF, Ping An Fund gold industry ETF rose more than 2%.

Since the beginning of the year, E Fund gold ETF, Boshi Fund gold ETF, Huaxia Fund gold ETF, Qianhai Kaiyuan Fund gold ETF, Guotai Fund gold ETF, ChinaAMC gold ETF, Jianxin Fund gold eftau, Nanshan Fund gold ETF, Zhongyin Shanghai gold ETF, Jia Shi Fund Shanghai gold ETF, Fuguo Fund gold ETF, Industrial Bank Rui Xin Fund gold ETF, Tianhong Fund Shanghai gold ETF, Guangfa Fund Shanghai gold ETF rose more than 20%.

On the news front, overnight gold frenzy, prices rose rapidly, once again hitting a new historical high.

The direct cause of the sharp rise in gold is the US economic data. In the past, gold has performed well among major assets during the rate-cutting cycle of the Federal Reserve. Recently, the release of US economic data has shown a slight easing of inflationary pressures. Therefore, the market believes that the expectation of a rate cut by the Federal Reserve is heating up, which has led to some inflows of funds into gold, pushing up the price of gold.

Gold has not recently started its strong performance. For a long period of time, with the increase in global uncertainties, a lot of safe-haven funds have poured into gold.

Wind data shows that COMEX gold has risen more than 25% year to date, London gold has risen more than 24% cumulatively, and gold has become one of the bright investment categories of the year.

Global central banks are also one of the drivers of the gold feast. The global central bank's "de-dollarization" layout has increased the demand for physical gold and helped push up gold prices.

Data from the World Gold Council show that in 2023, global central banks purchased a total of 1,037 tons of gold, the second-highest level in history, second only to the 1,082 tons in 2022. In the first half of 2024, the global central bank's new gold purchases amounted to 483 tons, a year-on-year increase of 5%, reaching a historical high for the same period.

Huatai Securities believes that in the first half of the year, "central bank gold purchases" have been a key driver of the rise in gold prices. However, since May, the core factors driving the rise in gold prices seem to have gradually shifted from "central bank gold purchases" to "interest rate cut trades." The current pricing of gold against interest rate expectations may already be relatively sufficient. Short-term disturbances include divergences in institutional behavior, a possible slowdown in central bank gold purchases, overcrowded long positions, and uncertainties surrounding the US election, among other factors, with central bank gold purchases having a significant impact on gold prices. However, in the medium and long term, gold still has a relatively high value for allocation. In terms of major asset classes, with the early stages of a soft landing in the US + the US election bargaining period + a period of domestic policy windows, the market as a whole is showing a certain degree of chaos, requiring higher flexibility in operations and greater margin of asset security. There is still uncertainty about the interest rate cut by the Federal Reserve in September, and post-debate polls and market performance show that Harris is slightly ahead, but the trend of the election remains variable.

Recently, Chief Economist Hong Hao of Sui Rui expressed that gold will continue to hit new highs. He pointed out that if the Fed cuts interest rates, the holding cost of gold will decrease, as holding gold earns no interest, while holding US government bonds does. The previous logic of investing in gold was mainly triggered by the absence of purchasing power of sovereign currency, as well as distrust of the existing US dollar credit system. Now, although the logic of sovereign debt and purchasing power still exists, the opportunity cost is decreasing, so gold will continue to hit new highs.

Industrial Securities stated that it is focusing on the opportunity for valuation recovery of gold stocks. The gold price has remained strong recently, with the latest quote breaking through $2,500 per ounce, hitting a new all-time high. Although the gold price is strong, there are concerns in the market that after the catalysts are fully priced in, gold may enter a correction channel, resulting in weak performance of gold stocks in the near term. Looking back at the past few interest rate cycles, significant corrections in gold prices occurred after interest rate cuts, such as in 1995. At that time, the Federal Reserve implemented preventive interest rate cuts, followed by a temporary rate hike during the recovery and heating up of the US economy. However, the 1998 Southeast Asian financial crisis prompted the Federal Reserve to cut interest rates again, and during this period, due to the sole performance of the US economy, a sharp increase in the US dollar index caused sustained pressure on gold prices. Returning to the present, although there is significant uncertainty about the future course of the US economy, its hidden downside risks are relatively clear, coupled with the impact of global geopolitical risks. Therefore, the direction of interest rate cuts this time is relatively certain to push the central hub of gold prices upward. Currently, the valuation of gold stocks is at a historical low range, already reflecting market pessimistic expectations. Under the background of continued increases in gold prices, future valuations are expected to recover.