The price of gold fell by its largest amount in 12 years yesterday, hitting returns for a raft of retail investors who have lined up to buy bullion in recent weeks and ploughed money into exchange traded funds. The price of the precious metal tumbled more than six per cent yesterday morning, albeit settling at a still relatively high level. The price of silver, which earlier this month hit a new high above 1980 levels, also tumbled, down almost nine per cent. Easing trade tension between China and the United States and a run of decent profit reports from Wall Street banks, including low bad debt levels, triggered the latest sell-off in gold.

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News in brief

Macquarie Group is considering dropping hundreds of investment options from its super investment platform angering brokerage and financial planning clients, and potentially forcing retail investors to find new places to invest their money.

REX, or Regional Express, has formally been sold to Nasdaq-listed Air T, an aviation business that runs cargo services and trades aircraft and their parts. Terms of the sale haven’t been disclosed though it is unlikely that the long list of creditors to the failed airline will get much, if anything, back.

House prices in Australia’s capital cities are rising at the fastest pace in four years, as falling interest rates supercharge the market. See the table at the end of the newsletter for the increase in each capital city.

Prime Minister Anthony Albanese is on the way home from the US. He shook hands with US Ambassador Kevin Rudd, boarded his flight, and after an unscheduled stop in Saint Louis, Missouri, headed home. Apparently, an RAAF member received a head injury after a heavy item fell from an overhead locker, and that’s why they diverted to Missouri.

OpenAI has launched its own web browser, Atlas, putting the ChatGPT maker in direct competition with Google’s chrome, as more internet users rely on artificial intelligence to answer their search questions.

Fear-o-meter

Let’s hope retail investors haven’t lost too much money because of the sell-off in gold and silver yesterday. I bet they have.

The sell-off comes days after ASX-listed gold exchange traded funds hit a record $997 million for this year, beating the previous peak of gold holdings during the COVID pandemic, according to Global X.

And queues around the ABC Bullion store in Sydney have grown in recent weeks. At least on paper, investors who have bought gold over the last week are now sitting on losses.

We need to keep in mind that gold, and silver, have surged in recent months hitting new peaks. Many investors will still be sitting on tidy profits. And the market is fickle. Plenty of experts say gold will bounce back.

But gold remains very, very highly valued on a historical basis. And retail investors have a track record of being the first to lose money when the market turns.

Fear & Greed Q+A today

On house prices in Australia’s capital cities rising at their fastest pace in nearly four years:

"All capital cities are rising... We have got this kind of unison of uplift, which we weren't seeing previously. There was much more stagnant conditions in some of our other capital cities. The way I would describe it now, though, is prices are rising across all of our cities, but we're starting to see growth diverge. 

We know that Perth, Adelaide is an example where the over-performers, they continue to see strong rates of growth... but they're losing a little bit of momentum. So they're growing at a slower pace than they once were.

 

But ... you've got other capital cities that are now reawakening, they're reemerging. Sydney and Melbourne are the two that jump out where they've seen the strongest growth. For Sydney, it's the strongest growth in about two years. For Melbourne, it's the strongest growth in about four years. And we've seen an acceleration in Brisbane pricing too."

Greed-o-meter

Here are the median house prices for Australia's capital cities. Brisbane is now the second most expensive city in the country, and Perth is less than $20,000 from hitting a $1 million median price.

Source: Domain September Quarter House Price Report

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