Dark clouds for stocks in September could be a silver lining for bullish gold and silver



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(Kitco News) – CNBC’s ‘Pro Playbook’ email dispatch on Thursday said, “August was tough for Wall Street, and September could be more or less the same. Data compiled by the Stock Trader’s Almanac shows that September is on average the worst month for equities.

Since 1950, the S&P 500 has recorded an average loss of 0.5% in September, including an 11.9% decline in 1974. The benchmark has also recorded losses in September for the past two years, falling 4.8% in 2021 and 3.9% in 2020. This historically weak performance for the month, along with the August declines and even higher rate expectations from the Federal Reserve and other central banks, are raising concerns about a possible retest of mid-June lows” in equity indices.

The above scenario may be what sets up low prices for the gold and silver markets. Gold hit a six-week low on Thursday and silver a more than two-year low.

The metals markets (hard assets) and the stock market (paper assets) are competing for money from traders and investors, and the turbulent months of September and October for the stock and financial markets may be just what the doctor ordered. for gold and silver markets.

It can also be argued that hawkish central banks and notions of weaker global economic growth, which could weigh on consumer and business demand for the metals, have now been factored into gold and silver prices. ‘silver.

Don’t be surprised if a “sell the rumour, buy the fact” scenario develops in the gold and silver markets in the near term, regarding the central bank bearish element for the metals.

Also, from a short-term technical perspective, the gold and silver markets are technically oversold and due for corrective rallies very soon.

Disclaimer: The opinions expressed in this article are those of the author and may not reflect those of Kitco Metals Inc. The author has made every effort to ensure the accuracy of the information provided; however, neither Kitco Metals Inc. nor the author can guarantee such accuracy. This article is strictly for informational purposes only. This is not a solicitation to trade commodities, securities or other financial instruments. Kitco Metals Inc. and the author of this article accept no responsibility for loss and/or damage resulting from the use of this publication.

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