Gold in a healthy consolidation period, says Chris Wood
Gold prices have risen by 85% since the start of 2022 while the MSCI AC World Index is up only 19% over the same period, according to the note.
Jefferies' Christopher Wood notes gold's consolidation above $3,000. He maintains high gold allocation in his pension fund. Western gold ETF flows are light despite gold's outperformance since 2022. Total ETF holdings are below 2020 peak. Gold prices have significantly outpaced the MSCI AC World Index since 2022. China's gold imports surged in April.
Tired of too many ads?
Remove Ads
Tired of too many ads?
Remove Ads
Mumbai: Jefferies' global equity strategist Christopher Wood said gold has entered a 'healthy consolidation' period with prices holding above US$3,000 an ounce-a level he described as ideal for gold mining companies to enjoy rising profit margins. In his newsletter, Greed & Fear, Wood said he maintains a 40% allocation to physical gold and 20% to gold mining stocks in his asset allocation for a US dollar-denominated pension fund."Normally, when a certain category of stocks outperform, there are strong flows into the related ETFs. But that has not been the case with gold in recent years," he said. "Flows into gold ETFs in the western world have remained relatively light given the dramatic outperformance of gold since the start of 2022."Total known ETF holdings of gold are up 10% from their May 2024 low but remain 20.3% below the October 2020 peak. Gold prices have risen by 85% since the start of 2022 while the MSCI AC World Index is up only 19% over the same period, according to the note.Wood said China has increased its gold purchases with imports rising 73% in April from the previous month to 127.5 tonnes, the highest level in 11 months. This volume is equivalent to nearly half of the average monthly global gold production outside China, he said."Holdings in China-listed gold ETFs have increased by 82 tonnes so far this year, compared to an increase of 53.3 tonnes in all of 2024," the note said.
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Business Standard
an hour ago
- Business Standard
Tata Motors tumbles on weak JLR outlook
Tata Motors dropped 5.26% to Rs 674.60 after its UK-based unit, Jaguar Land Rover (JLR), issued a softer outlook for FY26, dampening investor sentiment. JLR now expects an EBIT margin of 5-7% for FY26, down from the 8.5% it clocked in FY25. Adding to the pressure, the company guided for free cash flow to be "close to zero" this year, compared to 1.5 billion pounds in FY25. The management is eyeing a rebound in free cash flow by FY27-28 and eventually aims to push EBIT margins back to 10%, though no specific timeline has been laid out. JLR remains critical to Tata Motors bottom line -- contributing 71% to revenue and 80% to profitability in FY25. While average revenue per unit stayed above 70,000 pounds, it was flat year-on-year. On the trade front, the company continues to engage with the Trump administration over tariffs. A UK-US trade deal is expected to reduce tariffs from the current 27.5%, although Slovakia exports still face the full charge. Tata Motors, part of the Tata Group, is a global automobile manufacturer of cars, utility vehicles, pickups, trucks, and buses. The company's consolidated net profit from continuing operations declined 51.74% to Rs 8,470 crore while revenue from operations increased 0.39% to Rs 119,503 crore in Q4 FY25 over Q4 FY24.
India.com
an hour ago
- India.com
Meta Appoints Arun Srinivas As India Head; Role To Begin On July 1, 2025
Arun Srinivas Meta India Head: Meta, the parent company of the US-based social media giant Facebook, has appointed marketing veteran Arun Srinivas as its new Managing Director and Head for India. Srinivas, who has been serving as Director and Head of the Ads Business at Meta India since 2022, will replace Sandhya Devanathan in the role, effective July 1, 2025. This appointment follows Meta's decision to expand the role of its India Vice President, Sandhya Devanathan, who now also leads the tech giant's Southeast Asia business. Under the new role, Srinivas will oversee business strategy and revenue growth for India across all Meta platforms and business segments, and will continue to be part of the India leadership team. He will focus on strategic revenue priorities such as AI, Reels, and Messaging. Notably, Arun Srinivas will continue to report to Sandhya Devanathan. Who Is Arun Srinivas? According to his LinkedIn profile, Arun Srinivas has been with Meta for over four years and ten months, joining the company in September 2020. He first served as Director and Head of Meta's Global Business Group until September 2022, before taking charge of the tech giant's advertisement business in India. Before joining Meta, Srinivas built a strong career working with several major companies. He started out in 1996 as a Product Manager at Reebok. After over five years there, he joined Unilever as a Branch Sales Manager and went on to become the Vice President of Foods South Asia during his 15-year stint at the company. In 2017, he joined Bengaluru-based WestBridge Capital Partners as an Operating Advisor for two and a half years. Srinivas later became Chief Operating Officer (COO) and Global Chief Marketing Officer (CMO) at Ola in 2019, before moving to Meta in 2020. Arun Srinivas' Education He completed his Bachelor of Science degree from the University of Madras in 1993. Srinivas then earned a Post-Graduate Diploma in Management (PGDM) in Marketing from IIM Calcutta in 1996. In 2007, he also attended an Executive Education program in Strategic Customer Management at the Kellogg School of Management, Northwestern University in the USA.
&w=3840&q=100)
Business Standard
an hour ago
- Business Standard
As Donald Trump returns to G7 summit, rift with allies is even deeper
By Erica L. Green and Zolan Kanno-Youngs When President Trump last attended a Group of 7 meeting in Canada, he was in many ways the odd man out. At that meeting, in 2018, Trump called for the alliance of Western countries to embrace Russia, antagonized allies and ultimately stormed out of the summit over a trade battle he began by imposing metals tariffs on Canada. As he returns on Sunday for the Group of 7 meeting in Alberta, those fissures have only deepened. Since retaking office, the president has sought to shrink America's military role abroad and made threats to annex the summit's host after embarking on a much more expansive trade war. White House officials have said little about goals for the summit, but they are facing a self-imposed deadline of early July to reach trade deals. Trump's trade adviser even promised in April that the tariffs would lead to '90 deals in 90 days.' Despite reaching framework agreements with Britain and China, the administration has shown scant progress on deals with other major trading partners. The future of the president's favored negotiating tool is uncertain as a legal battle over his tariffs plays out in the courts. But a failure to reach accords could lead the Trump administration to once again ratchet up tariffs and send markets roiling. The summit also comes amid fears of a broader, regional war in the Middle East after Israel launched a surprise attack on Iran's leadership and nuclear facilities last week, prompting both nations to trade strikes. World leaders will also be focused on surging oil prices and Russia's war against Ukraine. Trump's aides say he will discuss a range of topics, including fairness in global trade, critical minerals, illegal migration, drug smuggling and international security. Leaders of the Group of 7 nations — Britain, Canada, France, Germany, Italy, Japan and the United States — will convene in Kananaskis, a remote town west of Calgary. The summit this week, the 50th such meeting, is usually a forum for the US president to leverage allies and partners to further its agenda and assert its leadership on global issues of consequence. But world leaders appear to be bracing for Trump's shift away from global partnerships. Canadian officials have said that they were scrapping hopes of issuing a joint communiqué, the traditional statement leaders put out at the end of such meetings. Trump refused to endorse the joint statement moments after it was released at the end of the 2018 summit. 'One thing that the G7 represents just beyond the world's largest economies is a community of shared values — shared values that Trump doesn't necessarily share or subscribe to,' said Rachel Rizzo, a nonresident senior fellow at the Atlantic Council's Europe Center. Beyond trade, the war in Ukraine is likely to be a point of contention at the summit. While Trump has signaled reluctance to stay engaged in the war and derided multilateral organizations like NATO, European allies have rallied around Ukraine. President Volodymyr Zelensky of Ukraine is expected to be in attendance. François-Philippe Champagne, Canada's finance minister, said the presence of Ukraine was meant to 'send a strong message to the world,' that the Group of 7 was recommitting to support Kyiv and hold Moscow accountable. At the 2018 summit in Canada, one of the biggest disputes between Trump and allies was when he demanded Russia's readmission to the Group of 7 nations. The country was ousted from the diplomatic forum after Putin violated international norms by seizing parts of Ukraine in 2014. Image He said Trump's attendance at the summit and his decision to impose tariffs on the other members had 'cast a deep shadow over the gathering in Canada.' Trump's increased hostility toward US allies is perhaps most exemplified by the relationship with the host country. The relationship between the neighbors and top trading partners has been at a historical low since Trump's re-election because of his decision to impose tariffs on Canadian goods and his continuing to threaten its sovereignty by asserting that Canada should be a part of the United States. Prime Minister Mark Carney of Canada has sought a cordial relationship with Trump, but during a meeting in the Oval Office last month delivered a stern response to Trump's suggestions: Canada 'won't be for sale, ever.' 'Never say never,' Trump replied. Kori Schake, a former defense official in the George W. Bush administration who directs foreign and defense policy studies at the American Enterprise Institute, said that Trump's treatment of Canada was 'emblematic of the bullying Trump considers appropriate.' 'If this is the behavior toward a country with which we share a 5,500-mile border and a common air defense, it's sure to be similarly antagonistic to other allies,' Dr. Schake said. A May poll showed that Canadian sentiment toward the United States was at a historical low. Nine out of 10 Canadians rejected Trump's idea of making their country the '51st state.' And recent travel data showed that Canadians were canceling or changing plans to visit the United States. Canadians have been so galvanized against Trump that the rift appeared to have swung national elections. After Canada seemed poised to elect a conservative as prime minister in its April elections, the pendulum swung in favor of Carney, a liberal, by 30 percentage points, because the conservative candidate was seen as too close to Trump. Still, while protests are expected during the summit, Alberta is a conservative stronghold within Canada, so Trump will find some friendly welcome there. Sometimes referred to as 'Canada's Texas' on account of its oil riches and conservative politics, Alberta is in the middle of a push to hold a secession referendum. Carney, who this year holds the Group of 7 presidency, has invited the leaders of several nonmember countries: India, Brazil, South Africa, Mexico, Ukraine, Australia and South Korea, and the head of NATO. In his second term, Trump has had explosive clashes in the Oval Office with Zelensky and Cyril Ramaphosa, the president of South Africa. Michael Froman, the president of the Council on Foreign Relations, said that while the United States had historically played a role as a consensus builder at Group of 7 summits, it had often come to the table with a different perspective than its allies. Froman argued that Trump was engaging the world, just under different terms than his predecessors. 'On some of these issues, we are currently alone,' Froman said. 'But I think one of the goals will be to bring other countries in our direction,' he added, 'whether that's through careful diplomacy' or 'the threat of tariffs and sanctions.'
