Diamond News Archives

Gold has rallied 12% since last August, but it’s still a buy. So are gold mining stocks. The metal and mining companies look like a good hedge against possible global turbulence, stagflation or recession ahead. Gold is a play on possible dollar weakness, too.

“I remain very positive and constructive on gold,” says Frank Holmes, the CEO and chief investment officer at U.S. Global Investors GROW, -3.10%^[1] which offers several precious-metals funds, including the Gold and Precious Metals Fund USERX, +1.55%^[2]

Gold analysts at Goldman Sachs think the metal will rally 4% to $1375 an ounce by this summer, and around 8% to hit $1425 an ounce a year from now.

That may not sound like a lot. But given the defensive characteristics of gold, those gains will look pretty nice in your portfolio if fears of inflation or recession — or some geopolitical crisis — put the S&P 500 into a downward spiral again.

Here are eight reasons to be bullish on gold GCJ9, -0.05%^[3] and 13 ways to get exposure to expected continued strength.

Declining bond yields: Yields on U.S. Treasurys have fallen sharply since last fall. Due to economic weakness in the U.S. they may...

Bundesverein Schmuck und Uhren (BVSU), Germany’s Federal Association for Jewelry and Watches has joined the Responsible Jewellery Council (RJC). The association is the first German jewelry trade association to become an RJC member.

Guido Grohmann, BVSH Managing Director, said “We are delighted to become a member of the RJC. Many organizations we work with have already been certified and our goal for the future is to promote RJC’s Code of Practices to better support our members.”

Edward Johnson, Director, Business Development at RJC, said “We’re delighted to announce Bundesverein Schmuck & Uhren as a Trade Association member – a move which marks another significant step forward in RJC’s tireless efforts in working with the jewelry industry to promote responsible business practices.

Bundesverein Schmuck & Uhren becomes the first German association to join RJC and through doing so demonstrates its commitment to a responsible supply chain for its members and the wider German industry. We believe working closely together will help us promote the many benefits responsible business practices provide to businesses in the supply chain - from mine to retail - in Germany and beyond,” Johnson concluded.

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Gold continued to pullback last night, moving lower in a range of $1321.60 - $1327.

The yellow metal traded up to its $1327 high during Asian time where it was capped by the old resistance level $1325-27.

The move was fueled by a modest dip in the US dollar (DX from 96.64 – 96.53), which was pressured from strength in the euro ($1.1330 - $1.1351) as German GDP (yoy) came in +0.9% as expected.

Gold retreated to its low of $1321.60 later during European hours where support from yesterday’s low held.

A rebound in the DX to 96.79 forced gold lower, which was boosted by a pullback in the euro ($1.1317, disappointing German IFO) and the pound ($1.3051 - $1.2968, EU states it can’t provide legally binding changes to the Irish backstop, Barnier fears accidental no-deal Brexit in 5 weeks).

Global equities were mostly stronger and a headwind for gold, with optimism over the US-China trade talks fueling gains.

The NIKKEI off 0.2%, the SCI was up 1.9%, European shares were up from 0.3% to 0.5%, and S&P futures were +0.5%. An increase in oil prices (WTI from $56.70 - $57.78) helped lift equities.

Just ahead of and through the NY open, US stock futures (S&P futures to 2779) dropped on news that the EU was ready to target Caterpillar, Xerox and others with tariffs if Trump targets EU cars with tariffs along with a plunge in Kraft Heinz (misses earnings, reveals SEC subpoena).

The US 10-year bond yield dropped from 2.685% to 2.655%, and the DX tumbled back to 96.53. Gold popped in response, and took out buy stops over last night’s high and former breakout level $1325-27 to reach $1330.70. A fair amount of short covering was seen....

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References

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