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Lyn Alden's top stock picks to survive 2021's 'bumpiness'; outlook on gold, economy

Kitco News

2021 will remain challenging for economic growth, with a recovery in the jobs market more likely to materialize only in the second half of the new year, according to Lyn Alden, founder of Lyn Alden Investment Strategy.

“I’ve been bullish on some of the banks lately, so that includes Scotiabank, that includes Sberbank of Russia, that includes some of the Singaporean banks. I’m pretty bullish on some of those higher quality, larger banks, with a three-year view,” Alden said.

The jobs market will continue to face pressure in the coming months.

“We had the sharp rebound [in the unemployment rate] after the March, April shutdown, but since the summer it’s really kind of rolled sideways, and unfortunately, the latest data point confirms that.

Now, with rising hospitalizations and other metrics in other countries, a lot of countries are beginning to institute small scale shutdowns, in some cases country-wide partial shutdowns. This winter ahead looks pretty challenging, especially for small businesses and jobs,” she said.

Changing behavior following a rollout of the vaccine should alleviate stress on the jobs market and consumer sentiment towards the second half of 2021, Alden said.

On gold, real rates will continue to be the dominant driver in 2021, and has been one of the main forces behind a lower gold price in the last few months, Alden said.

“We’ve seen a pretty sharp increase over the past couple of months to real yields, and that’s because the 10-year treasury bottomed back in August and it’s been on a pretty significant increase since then, so even though we’ve seen a mild increase in inflation expectations, we’re seeing an even sharper rise in nominal yields,” she said.

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