Click here for the PDF: The Weekly Beacon – April 5 2024
We will be giving some macro economic market updates on a weekly basis. No equity recommendations will be given in this commentary, and we encourage you to contact us if you have questions regarding any observations.
Feel free to send in your pictures of lighthouses to be featured in our weekly commentary.
This weeks issue: Gold prices, Gold miners, Central Banks gold purchases, S&P 500 components, Laggards in the S&P 500, Lululemon stock, Nike stock, Walgreens stock, Tesla stock, Semiconductors, Trump Media stock, GameStop, Meme stocks, SPAC King, Chamath, Billionaire interests, Capital raising, Wealth destroying stocks.
Gold records
On Easter Monday, gold prices advanced further into record territory. Physical gold prices were up another percentage point on Monday, closing in on $2,300 for the first time ever. As of this writing (Monday afternoon), gold prices are up 9.1% year to date, outpacing major indices across the world in recent weeks.
Gold’s rally has been supported directly by purchases from Central Banks who have been trimming their U.S. Treasury holdings in recent quarters. Gold demand has also been higher as investors forecast lower yields due to cooling inflation. There has also been increased retail demand for gold in China where investors have reportedly been looking for a hedge against Chinese securities which have been highly volatile over the last 2-3 years.
Here is a chart that tracks global Central Bank purchases and sales for gold since 1950, notice anything?
Numerous precious metals analysts have noted both fundamental and technical factors have supported gains for gold and suggested that forces in play could lift prices even higher.
Remarkably, gold has outperformed the S&P 500 since the start of 2022 when the FED began raising rates. This period of outperformance suggests that demand for gold is real, and investors have begun to hedge their portfolios with non-traditional assets like gold.
