Tags: Hartnett | gold | 1000 | stocks

BofA's Hartnett: Gold Below $1,000 Could Mark Peak for Stocks

By    |   Monday, 10 November 2014 05:53 PM

Many financial commentators see little relationship between stocks and gold. But Michael Hartnett, chief investment strategist at Bank of America, does — and the link is $1,000 an ounce for the precious metal.

“A sudden gap lower in the gold price below $1,000 should coincide with the final thrust higher in stocks, both indicating capitulation of the stubborn bears, the end of the melt-up and the next opportunity to get tactically bearish," Hartnett wrote in a commentary obtained by MarketWatch.

December gold futures settled at $1,159.80 on the Nymex Monday, after trading at a four-year low of $1,130.40 Friday. The S&P 500 index rose to a record closing high of 2,038.26.

"Market psychology is shifting from fear to greed, from the wall of worry to the beginning of hubris," Hartnett said.

Stocks may rise next year if the economy and earnings continue to grow, but returns should trail previous years, he maintains.

As for gold, "The market view remains that the Fed will raise rates by the middle of next year, which informs the bearish sentiment in gold," Tai Wong, director of commodity products trading at BMO Capital Markets, told Bloomberg.

The Federal Reserve has kept its federal funds rate target at a record low of zero to 0.25 percent since 2008.

"We find it difficult to see gold prices finding sustainable support in the near term as investment demand falls," Lachlan Shaw, an analyst at Commonwealth Bank of Australia, told the news service.

Related Articles:

© 2019 Newsmax Finance. All rights reserved.

   
1Like our page
2Share
Finance
Many financial commentators see little relationship between stocks and gold. But Michael Hartnett, chief investment strategist at Bank of America, does — and the link is $1,000 an ounce for the precious metal.
Hartnett, gold, 1000, stocks
265
2014-53-10
Monday, 10 November 2014 05:53 PM
Newsmax Media, Inc.
 

Newsmax, Moneynews, Newsmax Health, and Independent. American. are registered trademarks of Newsmax Media, Inc. Newsmax TV, and Newsmax World are trademarks of Newsmax Media, Inc.

NEWSMAX.COM
America's News Page
© Newsmax Media, Inc.
All Rights Reserved