Yahoo Finance Gold Shines as Weak Retail Sales Lift Rate-Cut Bets: 3 Winners
Toward the end of 2022, gold prices took a beating and plummeted below the $1,650 mark. However, gold prices gained momentum and settled above $2000 an ounce in 2023 amid geopolitical and recession anxieties.
In 2024, gold prices are expected to remain bullish as several banks continue to raise apprehension throughout the stock market. Meanwhile, the crypto market remains dicey, with FTX being the primary culprit.
At the same time, central banks’ interest in acquiring gold and an increase in consumption demand will surely jack up the price of the bullion metal this year and beyond. Several market participants are now projecting gold prices to surge well over $3,000 an ounce by 2025.
Gold prices, in reality, were off to a commendable start this year and are currently above the $2,330 per ounce mark. This means that gold prices are holding above the support level, and are looking to enter another growth phase.
And why not? Gold prices are well-poised to pick up steam as moribund consumer spending activity in the United States has fueled hope that the Federal Reserve will trim interest rates this year.
Big retailers, including Walmart Inc. WMT and Target Corporation TGT, have begun to cut prices of various products, indicating a slowdown in consumer outlays. To top it, sales at U.S. retailers barely picked up in May, while retail sales in the prior month were substantially revised downward, a tell-tale sign of a deceleration in consumer spending.
Thus, it is widely anticipated that the Fed will cut interest rates as early as fall, which is unquestionably a blessing in disguise for gold prices. Needless to say, money won’t be flowing out of gold and into high-yield fixed-income investments, particularly in a low-interest rate environment. By the way, the CME FedWatch Tool shows that 61.1% of market players are expecting a quarter-point trim in interest rates in the September policy meeting.
On this positive note, it’s prudent for astute investors to keep an eye on gold mining stocks such as Kinross Gold KGC, Royal Gold RGLD and Barrick Gold GOLD that can make the most of the uptick in gold prices. These stocks, currently, possess a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks Rank #1 (Strong Buy) stocks here.
Kinross Gold holds major assets in Canada and the United States, and is primarily involved in the exploration and operation of gold mines. The Zacks Consensus Estimate for its current-year earnings has moved up 40.5% over the past 60 days. The company’s expected earnings growth rate for the current year is 18.2%.
Royal Gold acquires and manages precious metals stream and royalty interests, with a primary focus on gold. The Zacks Consensus Estimate for its current-year earnings has moved up 7.9% over the past 60 days. The company’s expected earnings growth rate for the current year is 28.1%.
Barrick Gold is the largest gold mining company in the world and has mining operations in the United States. The Zacks Consensus Estimate for its current-year earnings has moved up 17.8% over the past 60 days. The company’s expected earnings growth rate for the current year is 26.2%.
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Target Corporation (TGT) : Free Stock Analysis Report
Walmart Inc. (WMT) : Free Stock Analysis Report
Kinross Gold Corporation (KGC) : Free Stock Analysis Report
Barrick Gold Corporation (GOLD) : Free Stock Analysis Report
Royal Gold, Inc. (RGLD) : Free Stock Analysis Report
