Understanding the Market | SD GOLD fell over 5% after a positive earnings surprise, with net profit in the first three quarters potentially doubling year-on-year; institutions warn to be cautious of short-term adjustments in gold

SD GOLD fell over 5% after a profit warning, and as of the time of writing, it has dropped 3.3% to HKD 38.74, with a trading volume of HKD 568 million. SD GOLD announced that it expects a net profit of RMB 3.8 billion to RMB 4.1 billion for the first three quarters, an increase of 83.9% to 98.5% year-on-year. During the reporting period, the company optimized its production layout, strengthened technological breakthroughs, and improved its management level, significantly enhancing operational efficiency, coupled with rising gold prices, leading to a substantial year-on-year profit increase. Notably, SD GOLD's net profit attributable to the parent company was RMB 1.03 billion in the first quarter and RMB 1.782 billion in the second quarter. Guojin Futures released a research report stating that the U.S. government shutdown has driven foreign gold prices to continue rising rapidly in October. After the domestic market opened on October 9, prices gapped up significantly. On Thursday evening, due to the ceasefire agreement between Israel and Hamas, tensions in the Middle East have eased, and some long positions took profits, leading to a pullback in gold prices. From early September to the close on October 10, London gold surged by USD 507.25 per ounce, and caution is warranted regarding the risk of a pullback after such a significant short-term price increase