Jewelry and Luxury Goods Sector Soars Amid Global Tensions

In a remarkable surge within the jewelry and luxury goods sector, companies like Guangdong Chj Industry Co Ltd have seen significant gains. The sector’s upward trajectory was highlighted by a more than 10% increase in the stock price of Man Kao, a key player in the industry. This rally was not isolated, as other companies such as Cai Bai Stock, Mingpai Jewelry, Lai Shen Tongling, Xinhua Jin, and Chao Hong Ji also experienced notable gains.

Global Tensions Fuel Gold Stocks

The backdrop to this surge in the jewelry sector is a complex web of global economic tensions. Recent escalations in geopolitical conflicts, coupled with the imposition of tariffs, have led to a significant increase in the value of gold as a safe-haven asset. The Gold Stock ETF (517520) saw a near 4% increase, with its components like Man Kao, Xibei Gold, Cai Bai Stock, and Cuihua Jewelry hitting their maximum daily price increase. This trend is reflective of the broader market’s response to the uncertainty brought about by the breakdown of the “90-day trade negotiation window” between the US and Europe, with the US raising steel tariffs to 50% and the EU preparing countermeasures.

Analysts’ Take on Gold and Jewelry Stocks

Analysts from Dongbei Securities and Zhongjin Research Institute have weighed in on the situation. They note that the current rise in gold prices is supported by four key factors: the ongoing tariff issues, a temporary lack of new catalysts for US fiscal deficit trading, potential risks from US economic data in the upcoming months, and the Federal Reserve’s continued wait-and-see approach. The “Great Beautiful Act” in the US, expected to pass before the 4th of July, is anticipated to significantly increase the US fiscal deficit over the next decade, further boosting gold’s appeal as a long-term investment.

Investment Opportunities in the Jewelry Sector

For investors looking at the jewelry sector, companies like Guangdong Chj Industry Co Ltd, which is listed on the Shenzhen Stock Exchange, present an interesting opportunity. With a market cap of 10.45 billion CNH and a close price of 14.37 CNH as of May 29, 2025, the company’s valuation and the sector’s recent performance make it a noteworthy consideration for those looking to diversify into consumer discretionary and luxury goods.

Conclusion

The recent developments in the global economic landscape have had a pronounced impact on the jewelry and luxury goods sector, with companies like Guangdong Chj Industry Co Ltd at the forefront of this rally. As geopolitical tensions continue to influence market dynamics, the allure of gold and related stocks as safe-haven assets is likely to persist, offering both challenges and opportunities for investors in the coming months.