KGI Asia stated in a report that in the past week, there were reports of attacks on Iranian nuclear facilities, which initially caused market panic. Although the news was later clarified, uncertainty still exists in the Middle East situation. At the same time, the US economy is stronger than expected, with Fed officials releasing "hawkish" comments, resulting in a general decline in global stock markets, with technology stocks and the Philadelphia Semiconductor Index seeing the biggest drop. Due to expectations of delayed interest rate cuts, prices of long and short-term bonds also generally declined, with only Asian investment-grade bonds seeing a slight increase. While almost all stocks and bonds were affected, some commodities were able to benefit from the unclear geopolitical situation and recorded gains. Safe-haven demand generally favors gold. Gold prices have increased by about 17% in the last 3 months, outperforming major global stock markets, oil prices, and copper prices. Earlier this month, spot gold prices briefly crossed $2400 per ounce, reaching a new historical high. KGI Asia pointed out that the unstable geopolitical situation and the hawkish stance of the Fed are both unfavorable for the stock market. However, for gold, the impact of these two factors may offset each other. During previous periods of systemic risk or economic downturn, such as after 9/11, the 2008 financial crisis, or the Eurozone debt crisis, when US stocks plummeted, the trends of gold and US stocks were opposite, potentially providing a similar safe-haven effect as US Treasuries and investment-grade bonds. In the current situation involving conflicts in the Middle East, gold also plays a certain role as a safe-haven asset. However, the current high US interest rates and US dollar index, combined with officials signaling a hawkish stance, may weigh on the performance of gold. Since gold does not generate income, holding gold means giving up the interest from holding bonds when interest rates are high, increasing the opportunity cost of investing in gold. Historically, gold has shown a highly negative correlation with real interest rates, with a correlation coefficient of -0.67 between gold and US 10-year real interest rates over the past 20 years. In other words, if central banks globally shift towards rate cuts in the future, a decline in interest rates will be favorable for gold prices. Furthermore, in addition to economic slowdown and rate cuts being favorable scenarios, when systemic risks emerge, government bonds and investment-grade corporate bonds also serve as safe-haven assets, helping to reduce the volatility of the entire portfolio and lowering risks.