On October 15, international gold prices reached a new historical high, capturing widespread attention. By 10 AM, COMEX gold soared past $4,200 per ounce, peaking at $4,205.8 per ounce; meanwhile, London spot gold broke the $4,180 mark, hitting a height of $4,186.8 per ounce. However, in stark contrast, Shandong Gold (01787, 600547.SH), a key player in the gold sector, experienced a drop after announcing positive earnings. Notably, on the same day, while gold prices continued to climb, Shandong Gold's AH shares showed a significant decline. Shandong Gold's H shares plunged sharply in the morning session, falling over 7% at one point, ultimately closing down 3.35% at HKD 38.68; in parallel, its A shares also witnessed a substantial decrease, dropping over 6% in early trading and closing down 2.77% at RMB 41.7. This contrasted sharply with the skyrocketing gold prices, reflecting a “cold” atmosphere. It is also noteworthy that on October 14, Shandong Gold had just officially announced a positive earnings forecast. The forecast indicated that the net profit attributable to the parent company for the first three quarters is expected to be between RMB 3.8 billion and RMB 4.1 billion, marking an increase of 83.9% to 98.5% year-on-year. Regarding the reasons for this growth, Shandong Gold noted its optimization of production layout, enhanced technological focus, and improved management levels, which significantly raised operational efficiency. With international gold prices reaching new highs coupled with positive earnings guidance, why did Shandong Gold's stock price still fall? Slowing Sequential Growth vs. Prospective Release of Multiple Construction Project Capacities Finance analysts observed that the decline in Shandong Gold's stock price post-earnings report could be attributed to combined factors: “doubt over internal positive quality” and “strong external negative environment.” From an internal perspective, there are noticeable signs of significantly slowing sequential growth, contributing to market disappointment after expectations were met. Although the company's net profit increased by 83.9%-98.5% year-on-year in the first three quarters, the growth rate for the third quarter saw a marked slowdown compared to the second quarter. In the first and second quarters of this year, Shandong Gold reported net profits of RMB 1.026 billion and RMB 1.782 billion, respectively. Based on estimates, the company’s third-quarter net profit is expected to hover around RMB 1.1 billion, suggesting a year-on-year growth rate above 60%, but a decline of about 40% compared to the second quarter. The company explained this decrease was primarily due to increased capital expenditure on mining infrastructure and transitional costs from operational adjustments. Furthermore, prior to the earnings announcement, Shandong Gold's A shares had risen consecutively for three days (with a limit-up on October 9 and a 5.7% increase on October 13), accumulating a total increase of over 15%, leading the market to have already more or less absorbed the positive earnings expectations. This prompted some investors to cash in, resulting in the price opening high but closing lower. This phenomenon of “good news being priced in as bad news” is relatively common. From an external viewpoint, the marginal easing of risk aversion coupled with sector rotation effects placed the gold sector in a corrective phase. In mid-October, while the conflict between Israel and Palestine remains ongoing, concerns regarding its spillover effects have cooled. The appeal of gold as a safe-haven asset has decreased, with funds favoring high-dividend or growth stocks. Additionally, on October 15, the broader gold sector also retraced, causing similar stocks like Chifeng Jilong Gold to decline, reflecting a shift in market valuation logic for gold stocks from “price-driven” to “sustainable performance.” It’s important to note that although Shandong Gold's performance saw a sequential growth slowdown, its business has shown a sustained upward trend in the last couple of years, buoyed by rising gold prices. In the first half of 2025, the company reported revenue of RMB 56.766 billion, a year-on-year increase of 24.01%; its net profit attributable to the parent company was RMB 2.808 billion, up 102.98%; and the net profit attributable to the parent company after excluding non-recurring gains and losses was RMB 2.810 billion, reflecting a growth of 98.74%. For the second quarter of 2025, the company achieved revenue of RMB 30.83 billion, marking a 14.97% year-on-year increase and an 18.87% sequential growth, with net profit attributable to the parent company reported at RMB 1.782 billion, showing a remarkable year-on-year increase of 160.53% and a sequential growth of 73.68%, achieving significant growth in both year-on-year and quarter-on-quarter metrics. On the project front, Shandong Gold is making steady progress on key projects, which is expected to help the company achieve its long-term production goals, thereby ensuring continuous performance growth. In the first half of 2025, the Shanshandao Gold Mine's secondary shaft project reached a depth of -1900 meters, setting a domestic deep well record. The company is also concurrently advancing the approval and construction of a parallel expansion project to process 15,000 tons/day, aiming to expedite overall project readiness. Additionally, of the five principal vertical shaft projects planned in the resource consolidation of the Jiaojia Gold Mine, four have successfully reached completion, and supportive works including unloading, draining, and transport are proceeding efficiently to ensure the timeline. Furthermore, four main shaft projects at the Xincheng Gold Mine have been fully excavated, and the construction of the underground drainage and power distribution system is underway, alongside excavation of the return air shaft and main transport passage. In terms of overseas projects, the company continues to advance the Katino company’s Namutini Gold Mine system tuning and trial production, with overall production status remaining steady and positive. Shanxi Jinjin International's acquisition of the Namibia Osino project, completed in 2024, is making substantial progress, with the construction of the processing plant set to start fully in the fourth quarter this year, and expected to be operational by the first half of 2027. Based on these factors, it is clear that the “stock price drop post positive earnings” for Shandong Gold results from multiple resonating factors: in the short term, sequential profit decline, reversal in market sentiment, and technical adjustments dominated stock price movements; in the long term, the company’s capacity release (such as the Katino project) and cost optimization (such as the transition to self-management) still hold potential. International gold prices surpassed $4,000, are they at a peak? Gold prices influence the performance of gold concept stocks significantly, and the breakout above $4,000 is indeed a noteworthy signal. On October 8, 2025, international gold prices achieved a historic moment. The COMEX gold futures price broke through the $4,000 mark during trading, peaking at $4,081 per ounce, while London spot gold also climbed, reaching a maximum of $4,059.31 per ounce. From a fundamental perspective, three key factors drove this price surge in international gold. First, in light of the U.S. federal government shutdown and escalating geopolitical conflicts, risk aversion saw a rapid spike. Specifically, the protracted government shutdown created uncertainty in economic outlooks, driving investors towards gold. Combined with the regional turmoil in the Middle East, gold's safe-haven appeal has escalated. As the concerns over political and systemic risks heightened, the "fear and greed index" showed a steady decline nearing the 50-point mark, moving into the "fear" zone. Second, expectations for U.S. interest rate cuts have continually strengthened. According to data from the CME FedWatch Tool, the probability of a 25 basis point rate cut in the upcoming meeting on October 29 is still at 95%. A lower interest rate environment decreases the opportunity cost of holding gold, boosting its price. Meanwhile, ongoing expectations of rate cuts have led to a steady decline in the yield of 10-year U.S. Treasuries, hovering around 4%. As gold serves as a natural alternative to bonds, it benefits from this yield decline. Third, a structural influx of capital has been observed. On one hand, central bank gold purchases remain robust: data from the World Gold Council showed that in the first half of 2025, global central banks recorded a net purchase of 415 tons of gold (despite a year-on-year decline of 21%, it still significantly exceeds the five-year average); on the other hand, there has been a surge in investment demand: SPDR's official data indicated that the world's largest gold ETF—SPDR—saw its holdings climb to 1,014.58 tons on October 8, setting a new historical high. Many private investors have flocked to gold ETFs, becoming an additional driver for the recent rise in gold prices. However, just a day later on October 9, international gold prices experienced a sharp decline, with spot gold falling below $4,000 per ounce and COMEX futures dropping over 1.9%. This quick rebound following a historical peak has drawn widespread market attention to the future trajectory of gold. Thus, an important question arises: Has international gold prices, now facing resistance past the $4,000 threshold, reached a peak? Chaida Futures posits that both from a technical and fundamental standpoint, one cannot conclude that gold prices have hit a historical apex; instead, it suggests a greater possibility of a continuation pattern. This viewpoint derives from the fundamental conditions, where the Gaza conflict remains a localized issue; however, geopolitical tensions, including the Russia-Ukraine conflict, continue to escalate. The impacts of various disruptive policies under former President Trump are still unfolding, contributing to heightened uncertainties, while central banks around the globe are increasingly shedding U.S. dollars in favor of gold as a reserve. There's still substantial room for further interest rate cuts by the Federal Reserve, all of which support gold and silver prices. Guoxin Securities notes that the retracement in gold prices post the $4,000 breakout is a normal reaction to the excessive short-term increase, stronger-than-expected economic data from the U.S., and easing geopolitical risks. The fundamental logic supporting long-term gold price increases remains unchanged. Factors such as slowing global economic growth and debt crisis risks continue to provide support for gold prices. This retracement can be seen as a buying opportunity rather than a signal of transitioning from a bull to a bear market. In the short term, the retracement is an opportunity for strategic entry, with key support levels to watch at $3,950 (international), alongside attention to the strength of the U.S. dollar index and upcoming Federal Reserve meetings. Long-term, maintaining an optimal gold allocation is recommended, focusing on investment targets like gold ETFs, physical gold, and gold mining stocks, such as Zijin Mining (H/A shares) and Shandong Gold (H/A shares), which offer significant leverage. Overall, as a company with a solid fundamental foundation and clear strategy, Shandong Gold's short-term stock price decline does not detract from its long-term growth potential. For long-term investors, Shandong Gold represents a high-quality target to capitalize on the benefits of a rising gold market, with its notable resource reserves, production scale, and internationalization underpinning its long-term value.