Gold’s price cycle has probably turned as the recovery in the US economy gathers momentum and investment holdings collapse, according to Goldman Sachs Group Inc, which reduced forecasts for the metal.
The bank cut its three-month target to US$1,615 an ounce from US$1,825 and lowered the six and 12-month forecasts to US$1,600 and US$1,550 from US$1,805 and US$1,800.
Goldman reversed an assumption exchange-traded products holdings will expand this year, analysts Damien Courvalin and Jeffrey Currie wrote in a report on Monday.
Gold has dropped 5 percent this year as economic data improved, equities advanced and some US central bankers sought more flexibility in their stimulus program. An inevitable unwinding of gold’s 12-year bull market has begun, Credit Suisse Group AG said on Thursday in a report. ETP holdings are poised for the biggest monthly decline since January 2011.
“The turn in the gold cycle has likely already started,” the Goldman analysts wrote in the report, after predicting an end of gold’s bull run in a note on Dec. 5 last year.
“The latest collapse in gold ETF holdings stands in sharp contrast to our assumption that ETF positions were likely driven by longer-term allocation rather than short-term trading,” the analysts said.
Gold for April delivery traded at US$1,592.80 an ounce on the Comex at 1:49pm in Singapore, poised for a fifth monthly drop in what would be the worst run since 1997. Holdings in ETPs, also known as exchange-traded funds, fell to a five-month low of 2,536.289 metric tonnes yesterday and have shrunk 2.9 percent this month, data compiled by Bloomberg show.
Billionaire investors George Soros and Louis Moore Bacon cut their stakes in gold ETPs last quarter, while John Paulson maintained his share, government filings showed this month.
Shares in Taiwan closed at a new high yesterday, the first trading day of the new year, as contract chipmaker Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) continued to break records amid an artificial intelligence (AI) boom, dealers said. The TAIEX closed up 386.21 points, or 1.33 percent, at 29,349.81, with turnover totaling NT$648.844 billion (US$20.65 billion). “Judging from a stronger Taiwan dollar against the US dollar, I think foreign institutional investors returned from the holidays and brought funds into the local market,” Concord Securities Co (康和證券) analyst Kerry Huang (黃志祺) said. “Foreign investors just rebuilt their positions with TSMC as their top target,
REVENUE PERFORMANCE: Cloud and network products, and electronic components saw strong increases, while smart consumer electronics and computing products fell Hon Hai Precision Industry Co (鴻海精密) yesterday posted 26.51 percent quarterly growth in revenue for last quarter to NT$2.6 trillion (US$82.44 billion), the strongest on record for the period and above expectations, but the company forecast a slight revenue dip this quarter due to seasonal factors. On an annual basis, revenue last quarter grew 22.07 percent, the company said. Analysts on average estimated about NT$2.4 trillion increase. Hon Hai, which assembles servers for Nvidia Corp and iPhones for Apple Inc, is expanding its capacity in the US, adding artificial intelligence (AI) server production in Wisconsin and Texas, where it operates established campuses. This
H200 CHIPS: A source said that Nvidia has asked the Taiwanese company to begin production of additional chips and work is expected to start in the second quarter Nvidia Corp is scrambling to meet demand for its H200 artificial intelligence (AI) chips from Chinese technology companies and has approached contract manufacturer Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) to ramp up production, sources said. Chinese technology companies have placed orders for more than 2 million H200 chips for this year, while Nvidia holds just 700,000 units in stock, two of the people said. The exact additional volume Nvidia intends to order from TSMC remains unclear, they said. A third source said that Nvidia has asked TSMC to begin production of the additional chips and work is expected to start in the second
US President Donald Trump on Friday blocked US photonics firm HieFo Corp’s US$3 million acquisition of assets in New Jersey-based aerospace and defense specialist Emcore Corp, citing national security and China-related concerns. In an order released by the White House, Trump said HieFo was “controlled by a citizen of the People’s Republic of China” and that its 2024 acquisition of Emcore’s businesses led the US president to believe that it might “take action that threatens to impair the national security of the United States.” The order did not name the person or detail Trump’s concerns. “The Transaction is hereby prohibited,”
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