After the post-election weeks of gyrations for gold, since late November it has largely held in the rough $2600s per ounce range, notably in line with our Q4 forecast of $2665/oz.
While Trump’s electoral win and the Republican sweep has impacted the thinking around growth, uncertainty, and rate cuts (and thus gold), we are hesitant to change our price view even if the underlying thinking has shifted.
Bottom line- wait until after the December FOMC for a rethink
How to use the chart in premium at bottom along with the report and Jobs expectations and CME new contract implications
US equities retreated on Thursday ahead of the US jobs report on Friday. Large caps bested small caps: S&P 500 (-0.19%) vs. Russell 2000 (-1.25%). MSCI Emerging Markets (EEM) and MSCI EAFE (EFA) added 0.66% and 0.49% respectively.
Market News: Buffering.. Buffering
"[BTC] has surged above $100,000 for the first time, extending a dramatic rally as investors bet on greater political and regulatory support from US president-elect Donald Trump...FT- Stop run discussion mechanics
"OpenAI is creating a new, more expensive tier for its flagship chatbot ChatGPT, and is bringing its “reasoning” model series out of preview with an update... The Verge- Bufferring…bufferring… nothing special, but it will destroy workplace as we know it…. why? Doesnt have to be better to be used, only has to cost less. bottom line vs topline… customers will put up with decreased service.. only trick is finding out how low you can go in cost cutting and passing on decreased quality.. ford pinto bo boom e.g.
"The pandemic... disrupted the trading behavior of individual investors. Between 2020 and 2024, such investors have exhibited more detrimental trading behavior than before [the pandemic], taking riskier bets and trading more inefficiently by trying to time market tops and bottoms. The upshot: Billions of dollars in lost portfolio value annually... Over a variety of actively traded mutual-fund styles from 2015 to 2019... poor market timing cost investors 0.53 percentage point a year in value to their portfolios. By comparison, from 2020 through Oct. 31, 2024, the average value destruction to one’s portfolio from poor market timing nearly doubled, to just over 1.01 percentage points a year in actively managed holdings." Source: WSJ- No shit. What did you think would happen giving pople money, a fed put, and free time
"Taiwan Semiconductor Manufacturing is in discussions with Nvidia to produce its Blackwell artificial intelligence chips at the contract manufacturer's new plant in Arizona... TSMC is already making preparations to start production early next year." Source: Reuters- all aboard the M-word onshoring
"Southwest Airlines and American Airlines raised their fourth-quarter forecasts on Thursday, citing strong demand and higher fares, sending shares in the carriers higher. CNBC- Inflation has morphed to services not goods
"Facebook-parent Meta said on Wednesday it plans to invest $10 billion to set up an AI data center in Louisiana, in what would be the tech company's largest data center in the world. The hyperscaler data center... is designed to process huge amounts of data required to support digital infrastructure, including artificial intelligence workloads. The development comes a day after Meta said it was seeking proposals from nuclear power developers to help meet its AI and environment goals." Source: Reuters Inflation, power competition for resources, nuclear
Politics/Geopolitics:
Senior Iranian official said Tehran has taken all necessary steps to increase number of military advisers in Syria and deploy troops; likely that Tehran will need to send military equipment, missiles, and drones to Syria.
IDF announces interception of suspicious air target after warnings in Upper Galilee, according to Sky News Arabia.
Russian Foreign Minister Lavrov said they are very worried after what happened in Syria, while he spoke with his Turkish and Iranian counterparts and they agreed to meet this week, according to Al Jazeera
White House stated regarding National Security Advisor Sullivan's meeting with Ukrainian officials that Sullivan focused the discussion on the President’s theory of the case to improve Ukraine’s position in its war against Russia, while it was stated that Ukraine’s position in this war will improve relative to Russia's as we enter into 2025 and will allow Ukraine to enter any future negotiating process from a position of strength.
Russia's Foreign Minister Lavrov said the use of hypersonic missiles in Ukraine means the West must understand that Russia is ready to use anything to stop notions of inflicting a strategic defeat on Moscow, while he added it is a mistake for anyone in the West to suggest that Russia has no red lines. It was separately reported that the Foreign Minister said Russia sees no reason why Moscow and Washington should not cooperate for the sake of the world.
Taiwan's President Lai said he hopes China does not take any unilateral actions and noted that more Chinese military drills won't win respect from any other countries in the region, while he added that authoritarian countries should not see Taiwan's engagement with other countries as a provocation and hopes China returns to rules-based international order. Furthermore, he said Taiwan's people cannot accept China's military operating around Taiwan, as well as noted that peace is priceless and there’s no winner in a war but also stated they cannot have any illusions about peace and must continue to strengthen defences.
Armed forces from Japan, Philippines, and US conducted "multilateral maritime cooperative activity" within the Philippines’ exclusive economic zone.
