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Yahoo
09-07-2025
- Business
- Yahoo
Why It Makes Sense to Keep Holding Gold ETFs?
Investor sentiment remained fragile in the first half of 2025, providing strong tailwinds for gold. Despite gradually easing geopolitical tensions, the Trump administration's chaotic tariff policies, weakening greenback and central banks' increasing purchases of the precious metal have contributed to gold's sustained appeal. Favorable fundamentals could position gold for further gains through late 2025 and into 2026. In such a scenario, increasing exposure to gold remains a smart strategy. Investors should not be discouraged by any likely decline in gold prices. Rather, they should adopt a "buy-the-dip" strategy. Given the increasing macroeconomic uncertainty and geopolitical volatility, gold remains an essential hedge for all investors, regardless of their investment theme. Here's why gold ETFs remain a compelling choice for investors. Expectations by some economists that inflation may worsen before easing toward the Fed's target have kept investor interest in the yellow metal elevated. According to Investopedia, a growing number of analysts anticipate a surge in inflation during the second half of 2025, as importers begin passing President Trump's tariff-related costs through the supply chain and ultimately to consumers. Across extended investment periods, gold preserves its purchasing power, outpacing inflation and diversifying an investment portfolio due to its historical tendency to have a negative correlation with other asset classes. The greenback has been losing its strength and trading near multi-year lows, marking its worst first-half performance since the 1970s, with both technical and fundamental factors working against the currency. Per Trading View, U.S. Dollar Index (DXY) has fallen about 10.36% over the past six months and around 1.34% over the past month. Gold prices are inversely related to the value of the U.S. dollar, and the greenback's struggles in 2025 have been a tailwind for the yellow metal. A weaker U.S. dollar generally leads to higher demand for gold, pushing its price upward as it becomes more affordable for buyers holding other currencies. The yellow metal gains additional support from expectations of rate cuts by the Fed. The greenback's value tends to move inversely with interest rate adjustments by the Fed. Interest rate cuts by the Fed make the dollar less attractive to foreign investors, as this weakens the U.S. dollar. Per the CME FedWatch tool, markets are anticipating a 69.4% likelihood of a rate cut in September and an 89% likelihood of a rate cut in October. Goldman Sachs now anticipates three quarter-point rate cuts this year, up from just one cut, per the previous expectation, citing softening labor market trends and limited inflationary impact from tariffs, as quoted on Reuters. According to the World Gold Council (WGC), in May, central banks added a net 20 tons to global gold reserves, an increase from the previous month, though the overall pace of accumulation has slightly eased. Sustained central bank buying could drive gold prices up. Per the Official Monetary and Financial Institutions Forum (OMFIF) Global Public Investor 2025, as quoted on WGC, 32% of central banks plan to increase their gold holdings over the next one to two years. Even with stabilizing geopolitical conditions in the Middle East, the only word that can be used to describe the geopolitical landscape in 2025 is 'complicated.' Amid the current economic and geopolitical climate, adopting a long-term passive investment strategy becomes the go-to approach for investors to weather short-term market storms. Concerns over U.S. debt levels can add pressure to investor confidence, making investors risk-averse and increasing demand for safe-haven assets. President Trump's tax-cut and spending bill was passed by Congress last week, reigniting the United States' mounting long-term debt risks. According to BBC, the tax-slashing bill is projected to add at least $3 trillion to the already staggering $37 trillion U.S. debt load. Per Reuters, lawmakers raised the U.S. government's borrowing limit by an additional $5 trillion. Investors can enhance their exposure to the precious metal to potentially boost portfolio gains and better prepare for an uncertain market environment going forward. Increasing exposure to the yellow metal stands out as a smart play than attempting to time the market, an approach that many investors may be tempted to employ. Investors can consider SPDR Gold Shares GLD, iShares Gold Trust IAU, SPDR Gold MiniShares Trust GLDM, abrdn Physical Gold Shares ETF SGOL and Goldman Sachs Physical Gold ETF AAAU to increase their exposure to the yellow metal. Each fund has a Zacks ETF Rank #3 (Hold). With a one-month average trading volume of about 9.49 million shares, GLD is the most liquid option, ideal for active trading strategies. However, implementing an active strategy in the current landscape may not be the most effective approach. GLD has also gathered an asset base of $102 billion, the largest among the other options. Performance across all funds has remained largely consistent. The funds have gained about 15.6% over the past three months and about 39% over the past year. Regarding annual fees, GLDM is the cheapest option, charging 0.10%, which makes it more suitable for long-term investing. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report SPDR Gold Shares (GLD): ETF Research Reports iShares Gold Trust (IAU): ETF Research Reports abrdn Physical Gold Shares ETF (SGOL): ETF Research Reports SPDR Gold MiniShares Trust (GLDM): ETF Research Reports This article originally published on Zacks Investment Research ( Zacks Investment Research Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
07-07-2025
- Business
- Yahoo
Manic Market Mood Carries a Warning for Budding Small-Cap Rally
(Bloomberg) -- Signs that US equities are overheating are cropping up everywhere, foreshadowing trouble for the nascent rebound in some of the riskiest stocks. Trump's Gilded Design Style May Be Gaudy. But Don't Call it 'Rococo.' Foreign Buyers Swoop on Cape Town Homes, Pricing Out Locals Are Tourists Ruining Europe? How Locals Are Pushing Back Massachusetts to Follow NYC in Making Landlords Pay Broker Fees NYC Commutes Resume After Midtown Bus Terminal Crash Chaos As the S&P 500 Index roared to a record high in the past month, shares of small-cap companies — which typically carry a higher debt load and are less profitable than their larger counterparts — surged even more. They handily outpaced bigger peers as investors shed their defensive stance and rushed into more speculative nooks. But history shows that when enthusiasm tips over into euphoria, it's a bad omen for small caps. A gauge of investor sentiment from Bloomberg Intelligence swung from panic mode in April to what BI calls 'approaching manic' in June. BI strategists led by Gina Martin Adams found that once the meter hits manic, markets tend to cool off and smaller stocks start to trail larger ones. In the three months after manic readings between 2012 to 2023, the S&P 500 Index beat the Russell 2000, a small-cap benchmark, by 178 basis points, the strategists said. It's one more signal that bears watching as traders rush into speculative and volatile edges of the stock market, raising their bets on momentum-driven names despite substantial uncertainty around trade, the economy and geopolitics. 'Generally, small caps are viewed as pro-cyclical, and work in the early stages of a rally and outperform in good periods,' said Mark Hackett, chief market strategist at Nationwide. 'And when the market drops, investors instinctively sell small caps.' The most recent and stark example of this behavior came in the aftermath of the sharp risk-on rally that gripped the markets after President Donald Trump's reelection. By late January BI's gauge hit manic levels. In the three months that followed the S&P 500 fell 7.8%, while the Russell 2000 sank 14% as the new administration's tariff regime unfolded and fears on the future of the artificial intelligence boom took hold. Fast forward to July, both small- and large-cap stocks are proving resilient amid signs the US job market remains solid. On Thursday, the S&P 500 gained 0.8% and the Russell 2000 rose 1% after stronger-than-forecast employment growth soothed concerns about the US economy slowing. Strong Rally Wall Street is watching small-caps as they are traditionally seen as a leading indicator, since they are historically the first to fall in times of economic turbulence and the first to emerge from a downturn. On top of that, investors worried about the narrow leadership in stocks — with tech driving most of the gains in equities in the past few years — have also been keeping a close eye on small-caps to see if that strength can broaden out. A stock market that is bolstered by wider gains is seen as healthier and more able to withstand any sudden shocks. After the Russell 2000 broke above its long-term trading range — the 200-day moving average — earlier this month, some are saying the group looks primed to climb further. Dennis DeBusschere of 22V Research recommends staying long on small caps. He says the combination of slowing but stable economic growth, easier financial conditions and the tax and spending deal all point to economic growth in the first half of 2026, which is 'positive for the riskiest or most economically sensitive stocks.' Trade Deadlines Still, with key deadlines on tariff talks between the US and major partners days away and the state of the economy still in question, some strategists say stick with larger names with stronger balance sheets and higher earnings power. Take Barclays strategist Venu Krishna. He still favors large-caps given the environment of weakening economic and survey data, despite the odds that Trump's tax bill will boost the earnings of small-cap companies by double digits. He prefers bigger stocks for their improving earnings revisions, better margins, robust balance sheets, and greater leverage to macro growth drivers, such as AI. 'We do not think fundamentals argue for a sustained reallocation away from large-caps,' Krishna wrote in a note to clients last week. For Brazil's Criminals, Coffee Beans Are the Target Sperm Freezing Is a New Hot Market for Startups SNAP Cuts in Big Tax Bill Will Hit a Lot of Trump Voters Too Pistachios Are Everywhere Right Now, Not Just in Dubai Chocolate China's Homegrown Jewelry Superstar ©2025 Bloomberg L.P. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Reuters
07-07-2025
- Business
- Reuters
Euro zone investor morale hits three-year record as recovery broadens
BERLIN, July 7 (Reuters) - Investor sentiment in the euro zone improved more than expected in July to hit its highest level in more than three years, a survey showed on Monday, as the bloc's economic recovery broadened. The Sentix index for the euro zone rose to 4.5 from 0.2 in June, beating the 1.1 forecast from analysts polled by Reuters and marking its third consecutive monthly increase. The current situation sub-index improved notably but remained in negative territory, rising by 5.8 points to -7.3, while expectations climbed 2.8 points to 17.0, also marking a third straight rise. The survey of investors, conducted between July 4-6, showed the recovery was broad-based across regions, with the United States economy making particularly strong gains after lagging in previous months. Germany, Europe's largest economy, also showed continued improvement with its overall index reaching -0.4, its highest since February 2022, as the current situation rose for a fifth straight month. The survey indicated the European Central Bank's room for further interest rate cuts may narrow as the economic upturn strengthens, though inflation pressures remain contained for now.
Yahoo
02-07-2025
- Business
- Yahoo
Asian Undervalued Small Caps With Insider Action In July 2025
In recent months, Asian markets have shown resilience amid global economic shifts, with key indices like Japan's Nikkei 225 and China's CSI 300 posting gains as trade tensions ease and investor sentiment improves. As small-cap stocks in Asia continue to navigate these dynamic conditions, identifying opportunities often involves looking for companies with strong fundamentals that can capitalize on favorable macroeconomic trends. Name PE PS Discount to Fair Value Value Rating East West Banking 3.2x 0.7x 31.26% ★★★★★☆ Atturra 26.5x 1.1x 40.78% ★★★★★☆ Daiwa House Logistics Trust 11.4x 6.9x 26.98% ★★★★★☆ Growthpoint Properties Australia NA 5.6x 21.03% ★★★★★☆ Lion Rock Group 5.0x 0.4x 49.81% ★★★★☆☆ Dicker Data 18.7x 0.6x -12.40% ★★★★☆☆ Sing Investments & Finance 7.5x 3.8x 36.99% ★★★★☆☆ AInnovation Technology Group NA 2.4x 48.16% ★★★★☆☆ China XLX Fertiliser 5.1x 0.3x -10.67% ★★★☆☆☆ Charter Hall Long WALE REIT NA 12.2x 20.79% ★★★☆☆☆ Click here to see the full list of 53 stocks from our Undervalued Asian Small Caps With Insider Buying screener. We'll examine a selection from our screener results. Simply Wall St Value Rating: ★★★★★★ Overview: Credit Corp Group operates in debt ledger purchasing across the United States, Australia, and New Zealand, as well as providing consumer lending services in these regions, with a market capitalization of A$1.83 billion. Operations: The company generates revenue primarily from Debt Ledger Purchasing in the United States and Australia/New Zealand, as well as consumer lending across these regions. Over recent periods, the net income margin has shown variability, peaking at 27.61% in December 2021 and experiencing fluctuations thereafter. Operating expenses are significant, with General & Administrative Expenses being a major component. PE: 8.8x Credit Corp Group, a small company in Asia, recently presented at the Macquarie Emerging Leaders Conference on June 18, 2025. Despite its size and potential for growth, earnings are expected to decline by an average of 0.7% annually over the next three years. The company relies entirely on external borrowing for funding, which is considered riskier than customer deposits. However, insider confidence is evident with recent share purchases by insiders in the past six months. Get an in-depth perspective on Credit Corp Group's performance by reading our valuation report here. Learn about Credit Corp Group's historical performance. Simply Wall St Value Rating: ★★★★☆☆ Overview: Jupiter Mines is a mining company that focuses on manganese production in South Africa, with a market cap of A$ 408.56 million. Operations: The company's primary revenue stream is from its manganese operations in South Africa, with recent quarterly revenue of A$9.49 million. Despite consistent gross profit margins at 1.0%, net income margin has shown variability, most recently recorded at 4.06%. PE: 10.2x Jupiter Mines, a smaller player in the mining industry, has seen insider confidence with Peter North acquiring 520,000 shares valued at A$88,399 in May 2025. Despite a challenging backdrop of declining earnings by 11.6% annually over five years and lower profit margins compared to last year, this activity suggests potential optimism from within. The company relies entirely on external borrowing for funding, adding risk but also indicating room for strategic financial maneuvers. Click here and access our complete valuation analysis report to understand the dynamics of Jupiter Mines. Understand Jupiter Mines' track record by examining our Past report. Simply Wall St Value Rating: ★★★★★☆ Overview: Daiwa House Logistics Trust focuses on investing in logistics and industrial properties, with a market cap of approximately SGD 0.55 billion. Operations: Daiwa House Logistics Trust primarily generates revenue through its investments in logistics and industrial properties. Over recent periods, the company has experienced fluctuations in net income margin, with a notable peak of 2.06% in 2022 before settling at 0.61% by the end of 2024. The gross profit margin has shown relative stability, hovering around 76%, indicating efficient management of direct costs associated with property investments. PE: 11.4x Daiwa House Logistics Trust, a smaller player in the Asian market, is attracting attention due to insider confidence as insiders have increased their share purchases over the past few months. Despite its financial position being strained by debt not fully covered by operating cash flow and earnings impacted by large one-off items, the trust continues to draw interest. However, with earnings projected to decline 4.9% annually over three years and reliance on external borrowing for funding, potential investors should weigh these risks carefully against any perceived value. Dive into the specifics of Daiwa House Logistics Trust here with our thorough valuation report. Examine Daiwa House Logistics Trust's past performance report to understand how it has performed in the past. Discover the full array of 53 Undervalued Asian Small Caps With Insider Buying right here. Are any of these part of your asset mix? Tap into the analytical power of Simply Wall St's portfolio to get a 360-degree view on how they're shaping up. Enhance your investing ability with the Simply Wall St app and enjoy free access to essential market intelligence spanning every continent. Explore high-performing small cap companies that haven't yet garnered significant analyst attention. Fuel your portfolio with companies showing strong growth potential, backed by optimistic outlooks both from analysts and management. Find companies with promising cash flow potential yet trading below their fair value. This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned. Companies discussed in this article include ASX:CCP ASX:JMS and SGX:DHLU. Have feedback on this article? Concerned about the content? with us directly. Alternatively, email editorial-team@
Asharq Al-Awsat
25-06-2025
- Business
- Asharq Al-Awsat
Strong Rebound in Gulf Financial Markets Following Ceasefire Announcement
Gulf financial markets recorded significant gains on Tuesday, driven by improved investor sentiment following the announcement of a ceasefire agreement between Iran and Israel. The development eased geopolitical concerns that had weighed heavily on the region's markets over the past two weeks. US President Donald Trump announced a full ceasefire late Monday, potentially bringing an end to a 12-day war that had led to mass evacuations from Tehran and raised fears of further regional escalation. Over the past two days, Gulf markets had already begun to show mixed but generally positive performance, recovering from consecutive losses since the conflict began. Saudi Arabia's main index, the Tadawul All Share Index (TASI), closed up 2.4%, reaching 10,964 points, marking its second consecutive day of gains. Trading volumes hit their highest levels of the year. Al Rajhi Bank led the rally with a 2.8% gain, while Aramco shares continued to decline by 2%, closing at SAR24.34, their lowest level in four years. In the UAE, the Abu Dhabi Securities Exchange saw its largest daily gain since October 18, 2022, rising by 2.5%. Meanwhile, the Dubai Financial Market index jumped 3.4%, achieving its strongest daily performance since December 16. Kuwait's Premier Market Index also rose by 2.4%, its best showing since April 8, and Qatar's main index climbed 1.9%, its strongest daily performance since April 10. Commenting on the rally, Mohammed Al-Farraj, Head of Asset Management at Arbah Capital, told Asharq Al-Awsat that the Gulf markets' positive reaction was a natural response to the easing of geopolitical tensions after the Iran-Israel ceasefire. He noted that much of the rebound was driven by short-term investors and speculators seeking to benefit from the upward correction sparked by political relief. Al-Farraj stressed that Saudi Arabia's market has become more resilient and mature in the face of oil price volatility, thanks to its ongoing economic diversification under Vision 2030. He highlighted that non-oil revenues accounted for approximately 40% of total government income in 2024, an indicator of a positive structural shift in the Saudi economy. Sectors like tourism, logistics, and mining are increasingly contributing to the country's GDP, enhancing the Saudi market's long-term appeal for both domestic and international investors. Regarding the broader region, Al-Farraj said that while Gulf markets remain closely tied to oil price movements - which affect government revenues and corporate profits - the Saudi market is advancing steadily toward reducing its oil dependency, boosting its ability to weather market fluctuations and enhancing its investment resilience.
