KUALA LUMPUR (March 14): Gold-related counters on Bursa Malaysia surged on Friday as the precious metal, a haven asset for investors, soared to a record high due to rising concerns over the US economy.
Jewellery retailers Tomei Consolidated Bhd (KL:TOMEI) rose as much as 8% to RM1.70 while Poh Kong Holdings Bhd (KL:POHKONG) climbed nearly 4% to RM1.05. Aumas Resources Bhd (KL:AUMAS), which operates a gold mine in Sabah, advanced 8% to 81 sen.
All three stocks are not tracked by any institutional analysts.
TradePlus Shariah Gold Tracker (KL:GOLDETF), an exchange traded fund which closely tracks the returns of gold, was up 3.5% to RM4.15 on Friday.
Prices of the yellow metal have been rising amid geopolitical turmoil while the trade war between the US and its major trading partners adds to concerns over the health of the world’s largest economy. The rally is now taking gold towards US$3,000 (RM13,337) per ounce.
Gold will comfortably break the US$3,000 level as soon as this week, said Hong Kok Wah, head of trading at local precious metal trading firm Go Capital Growth Sdn Bhd. It is also “highly possible” that gold prices could even hit US$3,200 by year-end, he said.
“Gold prices still have upward space at coming one to two years before world economy recalibrate to new Trump's administration policy order,” Hong added.
Demand for gold has intensified since the start of the Trump presidency and market observers have flagged a short squeeze on bullion in the market, as traders scurried to ship gold from Bank of England to the US to avoid Trump tariffs.
The UK central bank holds in its vault in London commercial gold owned by banks and other countries’ central banks, in addition to managing the country’s own gold reserves.
“The increasingly uncertain and volatile nature of Trump administration’s trade policy will likely reinforce the flow of gold bullion into US, reinforcing the ongoing global short squeeze in gold,” according to a March 10 note from United Overseas Bank.
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