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Gold Hits At All-Time High After Trump’s New Tariffs

Jordan Baird

Jordan Baird is the head ASR Wealth Advisers client services desk and has been with the organisation since 2017. He first started investing in his early years. While he believes that investors should leave no stone unturned he has a particular interest in trading based on broad macroeconomic trends along with specific analysis of innovative up-and-coming companies.

On Friday (2 August 2019) US President Donald Trump announced new tariffs on Chinese imports. President Trump tweeted:

U.S. will start, on September 1st, putting a small additional Tariff of 10% on the remaining 300 Billion Dollars of goods and products coming from China into our Country. This does not include the 250 Billion Dollars already Tariffed at 25%.

trade-war-trump

Which ASX gold stocks have performed the best? 

In reaction to President Trump’s tweet, the ASX fell 20.3 points by close of day (Friday 2 August 2019). However, the price of gold rose significantly to an all-time high of around A$2,117 per ounce, with the gold price rising in US dollars and the $US/$A exchange rate falling. The main gold stocks in Australia saw large gains - Saracen Mineral Holdings Ltd (ASX: SAR) up 10.8 per cent to $4.49, Resolute Mining Ltd (ASX: RSG) up 10.7 per cent to $1.86, Newcrest Mining Ltd (ASX: NCM) up 7.2 per cent to $36.66 and Evolution Mining Ltd (ASX: EVN) up 6.6 per cent to $5.15.

 

What is the global outlook for Gold?

The general global outlook for gold is positive. This assessment is made on the basis that there are a number of global political and economic concerns. A few concerns include the continuation of the proliferation of trade barriers in the form of tariffs mainly from the US and China, significant uncertainty around whether the new Prime Minister of the UK Boris Johnson can reach a successful Brexit deal and continued nuclear tensions in the Middle East surrendering the US and Iran.

With no resolution of these global economic and political concerns in sight, investors could expect gold and the Australian gold stocks to do well moving into the future.

 


 

Disclaimer:

This article has been prepared by the Australian Stock Report Pty Ltd (AFSL: 301 682. ABN: 94 106 863 978) (“ASR”). ASR is part of Amalgamated Australian Investment Group Limited (AAIG) (ABN: 81 140 208 288 Level 13, 130 Pitt Street, Sydney NSW 2000).

This article is provided for informational purpose only and does not purport to contain all matters relevant to any particular investment or financial instrument. Any market commentary in this communication is not intended to constitute “research” as defined by applicable regulations. Whilst information published on or accessed via this website is believed to be reliable, as far as permitted by law we make no representations as to its ongoing availability, accuracy or completeness. Any quotes or prices used herein are current at the time of preparation. This document and its contents are proprietary information and products of our firm and may not be reproduced or otherwise disseminated in whole or in part without our written consent unless required to by judicial or administrative proceeding. The ultimate decision to proceed with any transaction rests solely with you. We are not acting as your advisor in relation to any information contained herein. Any projections are estimates only and may not be realised in the future.

ASR has no position in any of the stocks mentioned.

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