HK Stock Market Move | Gold stocks across the board are falling, while oil prices are rising and US Treasury yields are hitting a high for the year. The market expects the Fed to raise interest rates as early as next week.

Gold stocks are falling across the board. As of press time, CHI SILVER GP (00815) fell by 5.36% to 0.265 Hong Kong dollars; CHINAGOLDINTL (02099) fell by 4.68% to 167 Hong Kong dollars; ZIJIN GOLD INTL (02259) fell by 3.85% to 114.9 Hong Kong dollars; LINGBAO GOLD (03330) fell by 4.01% to 18.91 Hong Kong dollars; Zijin Mining Group (02899) fell by 3.76% to 32.26 Hong Kong dollars. On the news front, the threat of escalation in the US-Iran conflict in the Middle East has pushed up oil prices, causing US Treasury yields to rise to their highest level of the year. Market expectations are that the Federal Reserve may raise interest rates as early as next week. The 10-year Treasury yield rose to around 4.7%, reaching a new high since January last year; in addition, the overnight 30-year US bond yield also briefly rose to 5.19%, just a step away from the highest level since 2007. Currently, Wall Street traders estimate that the probability of a 25 basis point rate hike at the Fed meeting on July 29 is about 30%, while the probability of keeping rates unchanged is about 70%. Sinolink Wealth Futures believes that the escalation of the US-Iran conflict, especially with Israel and the Houthis joining in, has further increased the probability of a situation escalation, causing oil prices to skyrocket. This dealt a heavy blow to gold, which had just started to rebound, causing gold to fall sharply. If oil prices continue to rise in the short term, gold prices will undoubtedly continue to be under pressure. The biggest risk in the gold market at the moment is the possibility of oil prices spiraling out of control. Sinolink believes that the recent rebound in gold and silver is a result of the breakdown of technology momentum and the rotation of funds outward, rather than a confirmation of a new trend.