By Aditya Raghunath
Investing.com -- The period from November 2-11 was a good eight days for world markets. Joe Biden won the U.S. Presidential elections and Pfizer’s clinical drug trials were successful. Companies reported better than expected results for the quarter ended September 30, 2020. Markets across North America, Europe, and Asia celebrated the good news with a strong rally.
However, as the enthusiasm from these events died out, people faced hard facts. Donald Trump is not going to make it easy for Joe Biden to govern. The Pfizer (NYSE: PFE ) drug will take months if not years to roll out, and the virus is back in its second wave threatening to derail the momentum businesses have picked up.
The U.S. recorded eight consecutive days of over 100,000 cases daily and large parts of Europe are under lockdown again. France said it has more people who are hospitalized now from COVID than in the first wave.
When such uncertainty exists in the market, investors turn to gold . Gold is currently trading at $1,875.5, up 0.11%. The commodity has fallen almost 8% from its August peak of $2,038. However, if the number of cases keeps going up, gold is a solid defensive investment.
It is inevitable that there will be another round of stimulus packages which may weaken the U.S. dollar and keep interest rates near record lows, both of which are key drivers for gold prices. Even Warren Buffett is bullish about the yellow metal and purchased Canadian mining company Barrick Gold in the second quarter of 2020.
Add Chart to Comment
We encourage you to use comments to engage with users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind:
- Enrich the conversation
- Stay focused and on track. Only post material that’s relevant to the topic being discussed.
- Be respectful. Even negative opinions can be framed positively and diplomatically.
- Use standard writing style. Include punctuation and upper and lower cases.
- NOTE: Spam and/or promotional messages and links within a comment will be removed
- Avoid profanity, slander or personal attacks directed at an author or another user.
- Don’t Monopolize the Conversation. We appreciate passion and conviction, but we also believe strongly in giving everyone a chance to air their thoughts. Therefore, in addition to civil interaction, we expect commenters to offer their opinions succinctly and thoughtfully, but not so repeatedly that others are annoyed or offended. If we receive complaints about individuals who take over a thread or forum, we reserve the right to ban them from the site, without recourse.
- Only English comments will be allowed.
Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at Investing.com’s discretion.
Fed is heroLike 0
very well describedLike 0
very well describedLike 0
i think gold once again come 58000 n also 38000Like 0
Dear Mr. Raghunath, Absolutely right. By Dec. 20 equities all over the world will take dip by 6-10 %Like 0