Gold-related stocks are among the leading decliners in the Hong Kong market. At the time of writing, China Silver Group Ltd (00815.HK) shares are down 4.92% to HK$0.29. Zijin Mining Group Co., Ltd. (02899.HK) shares have fallen 2.82% to HK$30.32.
Market Catalysts and Outlook
The recent market movement follows the release of the U.S. June Services PMI, which declined to 54 from 54.5 the previous month. Notably, the employment index recorded its largest increase this year, re-entering expansion territory, while the prices paid index fell to a four-month low. This resilience in the labor market suggests the Federal Reserve may not be in a hurry to stimulate the economy through interest rate cuts. Furthermore, U.S. Treasury yields have remained firm recently, with the 30-year yield briefly climbing back above 5%.
Analysis from Tongguan Jinyuan Futures points out that data from last week showed a significant slowdown in U.S. job growth for June, with previous months' non-farm payroll figures revised downward. This has led the market to scale back expectations for imminent Fed rate hikes. Precious metal prices have been rebounding recently as they digest the impact of last week's weaker employment data.
With the Federal Reserve's June meeting minutes scheduled for release this Thursday, investors are expected to maintain a cautious stance. Analysts indicate that precious metals may experience narrow-range fluctuations in the short term as the market awaits further guidance on monetary policy from the minutes.
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