Regular readers will need no recap of the huge storm clouds which have lingered over the global geopolitical landscape for months now fuelling the summer-long bull run. If you’re ready to invest but wanted to a window to do so, an opportunity has opened up this week as gold prices have traded lower.
For the moment, equities markets have staged a mini recovery but take heed – it isn’t very likely to last. The US China trade deal isn’t yet signed and sealed (and the phase 1 support from investors and traders has been poor after details were revealed) so we can surely expect more bumps in the road. China’s own economy is also slowing down, tensions continue to escalate in the Middle East and a Brexit agreement seems no closer with just 15 days to go. As if that wasn’t enough, US manufacturing output is slowing, workers are on strike at General Motors and Boeing, one of the largest companies in the US, has been struggling with a 737 Max crisis for months which will also drag on productivity.
According to CNN, “Economists polled by Refintiv have average expectations of 47.8 for the Institute of Supply Management’s October manufacturing index — down from the previous month. (A reading below 50 indicates the manufacturing sector is contracting.) The index, which will next be published on November 1, has fallen for two months in a row.” This could be a sleeping horse with the strike also impacting suppliers, potentially employment figures and consumer spending in the run up to the holiday season.
If you’re able to act quickly and buy now, do so as the market flurry putting pressure on gold prices looks temporary at best. It could be all change in a matter of days.