Market Nuggets
SP Angel: Gold Poised For Major Bull Run
Commodities brokerage SP Angel says gold is poised to enter a major bull market, with the precious metal up more 12% for the year to date. “While growth of 20% strictly defines a bull market, some market participants are suggesting a rally could involve significant higher gains that last for years,” SP Angel said. “The gold market has only surged twice since World War II, rising 1,755% through 1980 and 611% through 2011. The precious metal could build on recent gains as the Federal Reserve gets set to lower rates, U.S. economic activity slows and trade tensions remain. Historically, gold has rallied when Fed cuts occur because the move depresses bond yields and the U.S. dollar.” Analysts said markets expect the Fed to cut interest rates at its July 30-31 policy meeting.
By Allen Sykora of Kitco News; asykora@kitco.com
TDS Sees ‘Any Dips In Gold As Buying Opportunities’
Monday July 22, 2019 09:09
TD Securities looks for any significant pullbacks in gold prices to become buying opportunities. For now, gold remains range-bound above $1,400 an ounce as market participants try to guess whether the Federal Open Market Committee will cut U.S. interest rates by 25 or 50 basis points next week. “The yellow metal will likely trade choppy between $1,390-1,440/oz as this week's economic data and equity earnings influence market interest-rate expectations one way or the other,” TDS said. “But we ultimately see any dips in gold as buying opportunities as the underlying growth trajectory remains on a slowing path and as global central banks opt for easier policy.”
By Allen Sykora of Kitco News; asykora@kitco.com
Bannockburn: ECB Not Expected To Cut Rates This Week But May Signal Future Easing
Monday July 22, 2019 09:09
Will they or won’t they? Investors will be watching to see whether the European Central Bank cuts interest rates this week, with the market majority not expecting one but with the potential for policymakers to continue signaling a dovish tone, said Marc Chandler, chief market strategist with Bannockburn Global Forex, LLC. “The ECB meeting is the main economic event in Europe this week,” Chandler said. “The main issue is whether it merely prepares the market for easier policy in September or whether it acts now. ECB officials have made a case to act sooner rather than later and with a range of tools at their disposal (including rates, asset purchases, and forward guidance.” Market sentiment currently leans against an immediate cut mainly due to procedural issues and new staff forecasts that will be available in September, he said. “However, the forward guidance of a commitment to keep rates low through the middle of next year could be extended to the end of 2020 and include a phrase that would allow for lower rates,” Chandler said.
