Saudi Aramco announces $3 billion stock buyback and increased dividends

(1) Analysis: The strengthening US dollar and high US Treasury yields continue to weigh on gold, causing gold prices to decline consecutively and hit a two-month low. Expectations for a Fed rate hike in October have cooled, but there is still anticipation of policy tightening in December. The short-term technical structure suggests mainly consolidation, with the possibility of retesting previous lows. If support is found near $4070, a technical rebound may emerge. (2) Key focus: US Treasury yields, US Dollar Index, geopolitical situation (3) Resistance: 4180, 4200, 4250 (4) Support: 4100, 4070, 4000

1. On Thursday, gold prices edged higher after touching a two-month low in the previous session, as investors await further clarity on the Federal Reserve's interest rate trajectory. Spot gold rose as much as 0.6% to $4,135.03 per ounce and is currently trading near $4,123.59 per ounce. 2. On Wednesday, a stronger US dollar and rising US Treasury yields put pressure on gold prices, which hit their lowest level since August 5. Minutes from last month’s Federal Reserve meeting showed policymakers were divided over the case for further rate hikes: some officials saw a need to raise rates to curb energy and other price shocks, while the more hawkish core members believed it was necessary to guard against emerging demand-driven inflation. 3. According to the CME FedWatch tool, traders see only an 18% chance of a rate hike later this month, but still anticipate an 80% probability of a rate increase in December. Rising interest rates reduce the appeal of non-yielding gold. 4. International Monetary Fund Managing Director Kristalina Georgieva warned that the global economy faces risks from persistently high energy prices, record-breaking public debt, and a boom in artificial intelligence investment, urging governments to adopt protective fiscal and monetary policy measures. 5. On the geopolitical front, Saudi Arabia's Civil Aviation Authority said Wednesday that an attack on a Saudi airport killed three people, while Iranian-backed Houthi forces in Yemen have intensified fighting with Saudi-backed government troops. In addition, the CEO of Perseus Mining stated that while merger and acquisition activity is active in the gold sector, price volatility has made it difficult for companies to agree on valuations, and deals are expected to remain challenging.

Spot silver has just reached the $60.00/oz mark, now trading at $60.00/oz, up 0.39% on the day; the main COMEX silver futures contract is now quoted at $60.26/oz, down 0.06% on the day.

Affected by the Wall Street sell-off, the Japanese stock market fell for the second consecutive trading day. Persistently high oil prices have reignited inflation concerns and dragged down the stock market, which was nearing historical highs. Cyclical stocks, including trading companies, banks, and materials stocks, led the decline. According to Takashi Ito, Senior Strategist at Nomura Securities, AI and semiconductor stocks, as well as cyclical sectors such as steel manufacturers and nonferrous metal producers, may continue to face sell-off pressure. However, he noted that the solid earnings outlook for domestic companies should limit the extent of the downturn and make a dramatic drop like Wednesday’s unlikely.