Gold rushes to records
- March breakout sends gold to record levels
- Prices up more than 6% in six days
- Mining stocks haven’t kept pace with the metal
The stock market may have dominated financial headlines in recent weeks, but it’s not the only market that’s been setting records.
Not only did gold prices hit new all-time highs last week, they put an exclamation point on the move. After consolidating for most of January and February, April gold futures (GCJ4) broke out to the upside on March 1, and hit multiple record highs last week. By Friday, the market had topped $2,200 intraday and was up more than 6% for the month—the biggest six-trading-day rally since March 2023, and one of the biggest of the past 10 years:
Source: Power E*TRADE (For illustration purposes. Not a recommendation.)
Since 2014, gold has made only 25 other moves of this size (or larger) in a six-day period, and many of those were part of larger runs and/or occurred when the market was rallying off relatively low price levels. Only 14 of these moves occurred when the market, like it did on Friday, hit its highest high in at least a month.1
While upside bursts such as these didn’t necessarily stop the market from making even higher highs, in some cases the market did pause or pull back in the near term. A week after gaining 6% or more in six days while also hitting a one-month or longer high, gold was lower more than 60% of the time.
Finally, there’s been a big difference between the price of gold and mining stocks. Thanks to the recent rally, gold is currently in positive territory for the year. The S&P metals and mining index, however, gained only 2.6% in the first six trading days of March, and was down more than 4% for the year on Monday.
Market Mover Update: Is dealmaking back? Morgan Stanley & Co. analysts kicked off the week by detailing the reasons mergers and acquisitions activity—which hit a multi-decade low last year—could be turning the corner.2
Perrigo (PRG) rallied again on Monday (its fifth-straight up day), but it didn’t quite reach Friday’s high and is still around 4% from filling its February 26-27 down gap (see “Minding the price gap”).
Today’s numbers include (all times ET): consumer price index (8:30 a.m.).
Today’s earnings include: Kohl's (KSS), Guess (GES), Phunware (PHUN).
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1 All figures reflect spot gold prices, 12/31/13–3/10/24. Supporting document available upon request.
2 MorganStanley.com. M&A Rebound Ahead? 3/8/24.