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Mint
3 days ago
- Business
- Mint
Gold's rally broke down in May. It's still doing better than stocks.
Gold futures fell 0.5% to $3,288.90 per troy ounce in May to snap a four-month winning streak, with the metal marking its biggest monthly decline in five months, according to Dow Jones Market Data. Gold is still up 25.1% this year, far outpacing the S&P 500's 0.5% 2025 gain. The price of gold's retreat has coincided with a broader stock market rally. Investors bought gold in April as worries about the U.S. spiked amid President Donald Trump's trade war, so some market participants took profits as tensions faded. It's no coincidence that gold hit a record of $3,411.40 per troy ounce on May 6 before retreating: that's right when the White House said Treasury Secretary Scott Bessent would meet with China to discuss trade. Talks between the U.S. and China took place on May 10 in Switzerland. Gold pulled back while stocks rallied the following week, as traders reacted to news the U.S. would lower tariffs on China to 30% while both sides hammered out a deal. Fundstrat's head of technical strategy Mark Newton argues that precious metals like gold look to be near the end of their recent consolidation, meaning they could push back to fresh records in the months ahead. 'Safe-Haven trades like Japanese Yen and Gold should be starting to turn back higher, and I expect that Equities can still rally despite this happening into mid-June," Newton wrote in a Friday note. 'I favor Industrials, Financials, Technology and Utilities, while Emerging markets also have appeal given the drop in the US Dollar." Of course, the next move for gold may have more to do with the Trump administration's trade talks with China. Tensions have been higher in recent days, with Bessent saying on Thursday that talks had 'stalled." Trump on Friday said China has 'totally violated its agreement with us." U.S. Trade Representative Jamieson Greer later that day told CNBC that China failed to restore exports of some rare-earth magnets used for electric motors. 'Recently, China has repeatedly raised concerns with the US regarding its abuse of export control measures in the semiconductor sector and other related practices," Liu Pengyu, a Chinese embassy spokesperson, said in a statement on Friday. 'China once again urges the US to immediately correct its erroneous actions, cease discriminatory restrictions against China and jointly uphold the consensus reached at the high-level talks in Geneva." The market isn't taking the latest back and forth too seriously: Stocks barely moved on Friday. And gold? It fell 0.9%. Write to Connor Smith at
Yahoo
4 days ago
- Business
- Yahoo
Gold's Rally Broke Down in May. It's Still Doing Better Than Stocks.
Gold just wrapped up its worst month since December, but don't count the yellow metal out just yet. Gold futures fell 0.5% to $3,288.90 per troy ounce in May to snap a four-month winning streak, with the metal marking its biggest monthly decline in five months, according to Dow Jones Market Data. Gold is still up 25.1% this year, far outpacing the S&P 500's 0.5% 2025 gain.
Yahoo
6 days ago
- Business
- Yahoo
Nvidia's earnings are the stock market's next major test after May's Big Tech comeback
Megacap technology stocks have gotten a huge boost in May, as investors seek to turn the page on recent tariff tumult and as Nvidia Corp.'s earnings loom. U.S. banks might kick off earnings season and help set the tone, but it's the tech companies that lately have had the final word on whether the stock market had a good quarter or not. 'You never know what might happen': How do I make sure my son-in-law doesn't get his hands on my daughter's inheritance? My ex-wife said she should have been compensated for working part time during our marriage. Do I owe her? Trade court strikes down Trump tariffs: What it means for markets — and what's next My husband and I earn $115K and owe $220K on our home. We're inheriting $300K. Should we invest in real estate or stock? 'Is this a good tax strategy or a sham transaction?' My mother wants to give me her home. I have a plan to avoid taxes. With that in mind, Wednesday's fiscal first-quarter earnings from artificial-intelligence darling Nvidia NVDA have a special place on the week's calendar. Read: Nvidia reports earnings tomorrow. Here's the main issue on investors' minds. Shares of Nvidia climbed 3.1% on Tuesday, a day before its quarterly results were due, and are up 24.3% on the month so far, according to FactSet. The AI chip maker will be the final 'Magnificent Seven' company to walk the earnings gantlet this quarter. While 2025 has been fraught on Wall Street, the past few weeks have benefited this particular group of tech titans. That's because investors worried about tariffs and their potential toll on the economy once again have turned to technology names, instead of the broader stock market, as a port in the storm. This chart shows the huge gains of the 'Magnificent Seven' stocks since the lows of early April, against a rise of about 4.4% for the broader S&P 500 index, as well as a roughly 1.3% gain for its equal-weight version. 'I do think they are viewed, because of their business models and pervasiveness,' as a kind of 'safer play, no matter what happens with the economy,' said Melissa Brown, head of investment decision research at SimCorp. 'And despite their higher valuations, as a group, those have been the ones to really be able to deliver on earnings expectations.' The Big Tech comeback in May followed a harsh fall after President Donald Trump's 'liberation day' tariffs shocked investors, businesses and U.S. trade partners in early April. Trump's proposed 'maximalist' levies triggered a collective $2.12 trillion loss of market capitalization for the 'Magnificent Seven' companies between the market's close on April 2 to the lows of April 8, according to Dow Jones Market Data. In addition to Nvidia, Inc. AMZN, Microsoft Corp. MSFT, Google-parent Alphabet Inc. GOOG GOOGL, Meta Platforms Inc. META, Tesla Inc. TSLA and Apple Inc., AAPL make up this group. Trump's trade fight has evolved since early April to include 'pauses' on some tariffs to help cajole trade partners into quicker negotiations, as well as the promise of more deals to come after the U.S. and U.K. outlined a new trade agreement. Read: Trump rolls out U.K. trade agreement. It's a relief — but deals with other countries are more crucial. After details of the U.S.-U.K. deal emerged, the 'Magnificent Seven' added back $3.7 trillion in market cap between the April 8 low and a May 14 peak, bringing their combined valuation to about $16.8 trillion, according to Dow Jones Market Data. Since then, sharply higher bond yields BX:TMUBMUSD10Y BX:TMUBMUSD30Y have failed to dull demand for this popular group of stocks, a trend strategists attributed to their strong earnings, as well as optimism around plans to keep up AI spending. While first-quarter earnings have been good for the S&P 500 index SPX, they've been even better for technology companies. The S&P 500's blended earnings growth rate was pegged recently at 12.9% for the first quarter versus a year before, well above the 10-year average of 8.9%, according to FactSet data. But that's only part of the story. 'The Communication Services sector reported the second-highest (year-over-year) earnings growth rate of all 11 sectors at 29.2%,' John Butters, senior earnings analyst at FactSet, wrote in a May 23 report. Alphabet and Meta, however, ranked as the biggest contributors to the sector's earnings growth. Without those two companies, its blended earnings growth rate would have fallen to 9.6% from 29.2%, according to Butters. Still, this chart shows just how much the 'Magnificent Seven' stocks have outpaced the broader market, when comparing their earnings growth against the rest of the S&P 500's 493 companies. Their collective capex guidance for 2025 was pegged at about $330 billion, according to Jeff Buchbinder, chief equity strategist at LPL Financial. 'After Nvidia reports this week, these seven companies will likely end up driving nearly half of the S&P 500's EPS growth overall,' he wrote in a Monday client note. The broader S&P 500 posted a 2.1% gain on Tuesday, after Trump said over the long holiday weekend that his idea of a 50% tariff against the E.U. would be delayed until July 9, while the Dow Jones Industrial Average DJIA gained 1.8% and the Nasdaq Composite Index COMP rose 2.5%, according to FactSet. Nvidia's earnings are the stock market's next major test after May's Big Tech comeback Investors who followed 'sell in May and go away' are missing what could be the best May for the S&P 500 in decades It's my dream to travel to Africa. Can I pay for my husband's trip without commingling our finances? Treasury Secretary Bessent has a plan to bring down long-term yields. But will it work? After 25 years, I finally asked for separate checks — and my friends iced me out. Did I do something terrible? Sign in to access your portfolio
Yahoo
14-05-2025
- Business
- Yahoo
The S&P 500 just cleared a major hurdle in its post-tariff rally. The time it took may or may not be a bearish sign.
A stock-market relief rally lifted the S&P 500 SPX to a Monday close above its 200-day moving average — a level widely seen as a proxy for its long-term trend — for the first time in more than 30 trading sessions. History suggests that fears of a prolonged dip below that closely watched level, which is often seen as a sign of big trouble for the market, may be misplaced. My husband and I spend more money on our daughter and her family than on my single son. Do we compensate him? The bulls are back in town. Goldman and this Wall Street optimist are lifting their S&P 500 targets on tariff relief. 'Be vigilant with your finances': My IRA had an unknown beneficiary designation. How could this happen? 'I am scared to death that I'll run out of money': My wife and I are in our 50s and have $4.4 million. Can we retire early? 'It just doesn't seem right': My sister picks up the check for our parents, but later asks me to repay her The S&P on Monday surged 3.3% to finish at 5,844.19. The index climbed above its 200-day moving average of 5,749.44 after hovering below that key technical threshold for its longest stretch since 2022, according to Dow Jones Market Data. A common refrain among stock-market technicians is that the longer an index holds below the widely watched 200-day moving average, the more dangerous the market conditions would be for investors, and it implies waning market strength over the long term. But history shows that, since 1929, when the S&P drops from at least a three-year high and then stays below the 200-day moving average for at least 30 trading sessions, it is often followed by strong returns for the benchmark index in the months and year ahead, said Jason Goepfert, senior research analyst at SentimenTrader. The table above shows the large-cap S&P 500's performance following each time it cycled from at least a three-year high to holding at least 30 sessions below its 200-day moving average. Since 1929, the S&P 500 has typically gained a median 4.1% in the three months after spending over 30 days below its 200-day moving average following a drop from a three-year high. The index has also registered a median double-digit returns over the following 12 months, according to data compiled by SentimenTrader. To be sure, the S&P 500 did experience 'tough times' with double-digit losses suffered over the following year, most notably in 2000 and 2008, Goepfert said in a Monday client note. 'But most of the time, of course, that did not happen. Even though its average return and risk/reward weren't impressive over any time frame, they were mostly positive from two months and beyond,' he said. 'Most cycles from new highs to 30 days below average soon recovered.' That's also why Goepfert challenged the common market belief that stock-market conditions must follow certain bearish patterns just because the S&P 500 remains below a technical threshold. 'The idea that we're more likely to crash, or suffer a protracted bear market, simply because the most followed index in the world hasn't yet made it above its most widely-watched technical indicator, is mostly bunk,' he said. 'A decent heuristic we've seen lately is that if stocks lose a further 3% to 5% following these patterns, something rotten is more likely to occur. The worst conditions tend to see near-immediate failures after such conditions, so that will be something to watch in the weeks ahead,' Goepfert said. Opinion: The stock market is cheering the U.S.-China trade deal, but the damage is done Stocks staged an epic rally on Monday after the U.S. and China agreed to suspend some tariffs for 90 days as the world's two largest economies sought to navigate a path forward amid a bruising trade war. Their joint statement on Monday said that 'reciprocal' tariff on U.S. goods will be cut to 10%, while it will fall to 30% for products from China. The Dow Jones Industrial Average DJIA was up 1,160 points, or 2.8%, while the Nasdaq Composite COMP popped 4.4% and exited bear-market territory, according to FactSet data. See: Cooling U.S.-China trade tensions don't mean smooth sailing for U.S. economy Opinion: Trump avoids repeating Herbert Hoover's Smoot-Hawley tariff mistake — for now Monday's stock rebound also left investors questioning the sustainability of the relief rally as a cooling trade tension between the U.S. and China doesn't necessarily mean smooth sailing for the economy. 'For now, watch the S&P 500's 200-day moving average for clues on whether these higher prices will stick,' said Callie Cox, chief market strategist at Ritholtz Wealth Management. 'In past recoveries, the 200-day was the line in the sand between a mood-driven rally and a durable climb to new highs,' she told MarketWatch in emailed commentary on Monday. 'Also, keep in mind that recessions often lead to long and destructive selloffs fueled by losses in income and lower profits [for corporations] … We may not be there yet, but this is a scenario you can't rule out,' she added. Read on: Why the stock market is going to love higher U.S. tariffs on China My eldest son refused to share his father's $500K inheritance with his siblings. Should I cut him off? My friend's partner is pregnant, but she's married to another man. Is he financially responsible? 'We live modestly': My wife and I have $900K in stocks and $380K in savings and CDs. Are we holding too much cash? Gold skids more than 3% on tariff relief. Is it time to sell? The bull market has survived Trump's tariff onslaught. But stocks aren't out of the woods just yet. Sign in to access your portfolio
Yahoo
14-05-2025
- Business
- Yahoo
Gold skids more than 3% on tariff relief. Is it time to sell?
Gold prices suffered a hefty decline Monday, losing more than 3% as trade tensions ease, but some strategists say that it's not time yet to take profits — and that the precious metal may still rally to fresh record highs. 'The progress made in trade talks between the U.S. and China over the weekend significantly dials back trade tensions, stoking risk appetite and sapping gold's haven bid,' Peter Grant, vice president and senior metals strategist at Zaner Metals, told MarketWatch. My husband and I spend more money on our daughter and her family than on my single son. Do we compensate him? The bulls are back in town. Goldman and this Wall Street optimist are lifting their S&P 500 targets on tariff relief. 'Be vigilant with your finances': My IRA had an unknown beneficiary designation. How could this happen? 'I am scared to death that I'll run out of money': My wife and I are in our 50s and have $4.4 million. Can we retire early? 'It just doesn't seem right': My sister picks up the check for our parents, but later asks me to repay her The market, however, will want to see additional progress toward trade deals with China and other major trading partners, so the downside for gold is 'limited' from here, at least initially, he said. The May 1 low of $3,204.91 has held and is 'now reinforced as important short-term support.' On Monday, gold for June delivery GC00 GCM25 fell $116, or 3.5%, to settle at $2,228 an ounce on Comex. That was the biggest daily percentage loss for a most-active contract since April 23 and the lowest finish since May 1, according to Dow Jones Market Data. In a note Monday, chief global investment strategist Tim Hayes and analyst London Stockton, both at Ned Davis Research, said they've maintained a bullish position for most of the time since gold hit a cyclical bottom in the second half of 2022. Strength in the precious metal, which has gained 25% this year versus total returns of 2% for the Barclays Aggregate Total Return Bond Index, has also led to 'complacency and overbought conditions,' they said. Gold has seen a historical trendline growth of 6% per annum, and it's risen 'so far above the trendline that it is entering the top 20% of readings,' Hayes and Stockton said. 'This doesn't mean that gold will turn around right away — it does warn that the gold trade is a crowded trade with little margin for error if the conditions supporting gold start to worsen.' But 'now is not that time' to take profits in gold, they said, noting that their approach right now is to hold gold. The metal has yet to break below the 50-day moving average this year, 'providing itself an alternative for global asset allocation even without the appeal of interest or dividend payouts.' Zaner Metals' Grant, meanwhile, said there is 'still a fair amount of economic uncertainty out there, and geopolitical tensions remain elevated.' He said: 'Monetary policy remains generally tilted toward easing. Even with the recent gains in the dollar, the downtrend since the beginning of the year is intact. Central-bank demand and heightened investor interest are supportive as well.' Grant said his 'preferred scenario' for gold calls for additional consolidation within the $3,500 to $3,200 range, with 'modest risk for a downside extension' to $3,165 to $3,150. Gold prices last climbed to a record intraday high of $3,509.90 on April 22. Still, Grant believes the 'underlying trend remains positive' and expects further tests of $3,500 within weeks. My eldest son refused to share his father's $500K inheritance with his siblings. Should I cut him off? My friend's partner is pregnant, but she's married to another man. Is he financially responsible? 'We live modestly': My wife and I have $900K in stocks and $380K in savings and CDs. Are we holding too much cash? Gold skids more than 3% on tariff relief. Is it time to sell? The bull market has survived Trump's tariff onslaught. But stocks aren't out of the woods just yet.
