Why the gold price and stock markets are disconnecting

Frik Els | October 28, 2013 | 8:30 pm Energy Precious Metals Gold 

The gold price consolidated recent gains on Monday holding firm above the key $1,350 an ounce level it scaled last week to reach a five-week high.

In late afternoon trade on the Comex market in New York December gold futures changed hands at $1,353.60, a slight gain on Monday’s close, but off its highs for the day of $1,362.

The price of gold has rallied sharply from the intra-day low of $1,182.60 an ounce hit on June 28, but remains down 19% for the year.

While the stock market continues to set record highs in the US, gold is headed for its first annual loss in 13 years.

Bloomberg takes a look at the reasons why bullion is underperfoming the S&P 500 by the biggest margin since the 1997 Asian financial crisis this year:

Mining.com Recommends

4 Comments

  • Rod

    No one should be surprised that gold is down and the market is up, even with a clear view of the incredibly horrible economic condition of the USA, if one considers that the combination of the largest banks, various government and international agencies and wealthy individuals (backed by trading entities, lawyers and individual Senators and Representatives) collectively have determined ways to exert pressures on various financial instruments to create millions, tens of millions and hundreds of millions of dollars in gains for themselves. When these same players have determined that they have soaked up enough capital for themselves under current conditions, they will turn the table around and increase gold, depress the market and make the same gains in the opposite direction. The only thing that 99% of the people can do is to hold on and see where the next round of manipulation of markets will take them. How can anyone not understand this?

  • Matt

    Rod, most people understand it, much like lemmings know that cliff jumping is not a good thing, but what can they do about it?

  • STInfosystem

    great work done really this is a nice post great analysis thanks

  • aligncenterdotorg

    Friendly charting advice: use a gold colored line for the gold price.

    • More News