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Morning Research Notes - 31.03.25
Wall Street closed sharply lower on Friday as hotter-than-expected inflation data and ongoing trade tariff uncertainties dampened investor sentiment. Commodities had a mixed performance on Friday. Gold rose by 0.9% to $US3085.12 an ounce. Brent Crude (oil) slightly declined, falling by 0.5% to $US73.63 a barrel. Iron ore also decreased, dropping by 0.2% to $US103.25 per tonne.
Wall Street closed lower on Friday, with the S&P 500 falling 2%, the Dow Jones Industrial Average dropping 716 points (1.7%), and the NASDAQ slipping 2.7%. The market was impacted by hotter-than-expected inflation data, particularly the core personal consumption expenditures price index, which rose to 2.8% annually in February. This data dampened hopes for sooner rate cuts by the Federal Reserve. Additionally, ongoing trade tariff uncertainties and a significant drop in U.S. consumer sentiment to a two-year low further weighed on market sentiment.
The Australian market closed up on Friday with the ASX200 rising by 0.16%. Major sectors, Materials, Financials and Utilties also notched gains, gaining 0.39%, 0.51% and 0.22% at the close respectively. Contrastingly, Info Tech and Healthcare, closed in the red, falling by 2.16% and 0.42%. Major commodities, Aluminium, Copper and Nickel also had a bullish day, notching gains whereas Zinc dropped, falling by 1.38%.
Goldman Sachs has increased its year-end gold price forecast from $3,100 to $3,300 per troy ounce, with a range of $3,250-$3,520, due to unexpected rises in ETF inflows and strong demand from central banks. The report also suggests that in extreme scenarios, gold prices could exceed $4,200 per ounce by the end of 2025. China's central bank continues to play a crucial role in the global gold market by accumulating gold as part of its diversification strategy. Similarly, Bank of America has raised its gold price target to $3,500 per ounce, expecting this level to be reached within two years.
Source: Goldman Sachs, ChartOfTheDay
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