Chinese Gold Mining Stocks fall as gold prices lose momentum

Chinese gold-mining stocks fell sharply after the precious metal fell below $5,000 an ounce, as the Federal Reserve kept rates unchanged and voiced caution about the Middle East conflict’s impact on inflation, according to MarketWatch.

Shares of China’s largest mining company, Zijin Mining Group, lost 6.9% in Shanghai and 8.0% in Hong Kong on Thursday. Shandong Gold-Mining’s H shares fell 6.2% and Zijin Gold International shed 6.5%. Gold ended below the psychologically significant level of $5,000 per ounce for the first time in a month on Wednesday, ICE data showed. Spot gold was last 0.7% higher at $4,852.16 an ounce.

Rising energy prices are dimming expectations of the Federal Reserve easing rates. Markets are now pricing only one rate cut this year, down from earlier expectations of three reductions, ANZ analysts said. “Gold continues to face near-term downward pressure as oil-driven inflation concerns reduced Fed cut expectations and support the USD, offsetting safe-haven demand from geopolitical risks,” OCBC FX strategists said.