Gold price to hit US$3,000 in 2023?

In my last article on gold on 4 December 2021, I made the argument that gold price was set for a big fall in 2022 due to the possibility of US interest rate hike. I also highlighted that a drop in gold price would represent good buying opportunities for bullion investors. Indeed, gold price had a major decline in 2022, falling from US$2,040 per troy ounce on 8 March 2022 to a low of US$1,628 per troy ounce on 3 November 2022.

Admittedly, I had not practised what I had preached as I had not bought bullion when gold price collapsed in 2022 (my funds were tied up in the purchase of a new home). Nonetheless, I was shocked that Monetary Authority of Singapore (MAS) had done so in late 2022.

According to the MAS website on International Reserves and Foreign Currency Liquidity, the volume of gold held in our national reserves in December 2022 was 4.94 million troy ounces. As at January 2023, the volume of gold held surged to 6.38 million troy ounces. Thus, the increase in gold held in Singapore reserves represented about 30%. This means that within the span of just a month, MAS had increased gold bullion by a significant quantum.

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OCBC share price (SGX: O39) in trouble

In banks, things move at the speed of light. Within the span of just one week, three large US banks had failed – Silicon Valley Bank, Silvergate and Signature Bank. The collapses ignited global fear of contagion in the financial sector, leading to another massive financial crisis not seen since 2008. The fear is not unfound as Credit Suisse got rescued by Swiss National Bank with a US$54 billion loan while a consortium of US banks loaned First Republic a whopping US$30 billion to prevent a contagion from spreading in US. Against this backdrop, what is the implication for OCBC share price?

The narrative for OCBC share price had certainly turned scary in 2023. When I invested in OCBC in August 2021, my thesis was that bank stocks should perform well in high inflationary environment as high interest rates generally lead to higher net interest incomes for the banks. Back then, I had anticipated that US Federal Reserves would hike interest rates in 2022 and that Singapore bank stocks would be the biggest beneficiary from the rate hikes. However, it seems that the series of interest rate hikes by US Federal Reserve could be tipping global economy into a financial crisis instead.

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Singtel share price (SGX: Z74) in crisis

What an ambush out of nowhere! It seems that I had grossly underestimated the impact of Optus cybersecurity attack on Singtel share price (SGX: Z74).

Six months had passed since the Australian unit of Singtel suffered the fateful cybersecurity attack but Singtel share price (SGX: Z74) continued to be in sluggish form. In fact, at current trading levels, Singtel share price has reverted to the previous low in the aftermath of the cybersecurity attack. When can the counter shake off the blues?

Singtel share price

In my last article, I wrote that Singtel share price (SGX: Z74) might have turned the corner due to several strong financial performances in the past few quarters. However, in the stock market, sentiments often prevail. In this regard, clouds of uncertainty may engulf Singtel share price (SGX: Z74) in the coming months until the cybersecurity issue is fully addressed.

To recap, in 22 September 2022, Singtel revealed that its Optus customers’ data were leaked following a cybersecurity attack. Then in October 2022, the telco announced that about 1.2 million of the Australian customers were affected. Apparently, some of the customers’ passport numbers were exposed by the perpetrators. The incident led to fear that a massive class suit action could be coming Singtel’s way.

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