Gold loan stocks jump up to 5% as gold rate today tops ₹1.80 lakh amid geopolitical tensions

Gold loan NBFC stocks extended their gains during Thursday’s session on January 29, even as the Indian equity market resumed its losing streak. The rally was supported by the phenomenal run in gold prices, which scaled another fresh milestone.

Shares of Muthoot Finance jumped 5% to the day's high of ₹4,149.50 apiece, while those of Manappuram Finance gained 2.5% to 298.75 apiece, as investor sentiment toward these stocks remained buoyant amid expectations that rising gold prices will further boost demand for gold loans.

Both stocks mirrored the gold price rally in 2025 as well. Manappuram Finance ended the year with a 64% surge—its best annual performance in five years—while peer Muthoot Finance delivered an even stronger return of 78.4%.

Other factors also worked in their favour, including sustained demand for gold loans over recent quarters, with analysts expecting this trend to strengthen further. In addition, healthy financial performance, target price upgrades, and easing of lending guidelines by the Reserve Bank of India have helped these stocks defy market volatility in 2025.

Gold prices top ₹1.80 lakh per 10 grams on MCX

Gold prices extended gains to the third straight session, with February futures on the MCX rising another 9% to a fresh record high of ₹1,80,799 per 10 grams, crossing the ₹1.80 lakh mark for the first time. The rally has pushed prices up by 31% so far in January.

In the international market, spot gold prices topped $5,600 per troy ounce, taking the month-to-date surge to 30%. In the previous session, spot prices closed 4.6% higher, marking the biggest one-day gain since the peak of the Covid-19 pandemic in March 2020.

The sustained rally suggests that investors continue to flock to safe-haven assets as geopolitical tensions remain elevated, keeping the appeal of precious metals intact.

Tensions in the Middle East have resurfaced after US President Donald Trump warned Iran to strike a nuclear deal or face possible military action. Trade concerns have also kept prices elevated after Trump threatened South Korea and Canada with additional tariffs.

Despite the US Federal Reserve holding interest rates on Wednesday, as widely expected, market focus has shifted to growing expectations that Trump will soon announce his pick for Fed chair, alongside his prediction that interest rates will fall once the new chair takes over.

The rally has further been supported by concerns over the independence of the US Federal Reserve, which has reinforced the debasement trade. A weakening US dollar has also aided the gold and silver rally, with the dollar index touching a four-year low earlier this week. Trump has said he is not concerned about the recent decline in the world’s reserve currency.

In addition, reports suggesting that global funds are moving out of US markets amid uncertainty over Trump’s economic policies have added pressure on the dollar.

Disclaimer: We advise investors to check with certified experts before making any investment decisions.