Gold News

Stock markets set to influence Gold Investment

Gold Investment in the coming weeks will hinge on the performance of the stock markets, it has been revealed.

Wallace Ng, chief precious metals dealer at Fortis Bank's commodity derivatives unit, intimated in an interview with Bloomberg that more people would Buy Gold in the event of a stock market fall.

This is because he expects gold to reaffirm its position as a safe haven in times of economic uncertainty.

"If the stock market goes down a little, people may buy gold as insurance, however, if the stock market goes down a lot, people may need to sell gold to meet margin calls," he told the news provider.

Regardless of which way the stock market goes, Mr Ng believes gold should be viewed as a long-term rather than a short or medium-term investment - and when looked at this way the yellow metal is an attractive prospect.

"The medium to long-term trend is for higher prices but I think it's going to be a gradual move up rather than an explosive one," he commented.

"Gold's in a holding pattern right now, taking cues from the stock markets."

Last week DH Pai Panandiker, president of the RPG Foundation, said that investors looking to make returns in the long-term would do well to buy gold as supply is likely to contract.

"Gold supply will shrink and prices over time will rise to make gold a good investment," he confirmed in a Reuters interview.

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