August 2, 2020
Weekly Market Outlook
By Keith Schneider
Equity markets mostly recovered from an early swoon this week buoyed by stellar performance from digital tech giants while safety plays got ignored. The NASDAQ100 closed +4% for the week and up 25% YTD, but the Dow Industrials closed down -.15% for the week and -7% YTD. So much for the Dow being blue chips, maybe we change the label to red chips.
Meanwhile, gold and silver continued their upward trajectories leaving breakaway gaps in their wake……so where is the selloff in precious metals that many pros and pundits are looking for?
Considering that the Gold/SPY ratio is around 1/3 of where it was when gold hit it’s highs in 2011, and gold currently represents less than 1% of the holdings in most portfolios, it seems the fun is just the beginning. Adding more fuel to the fire, the price of Gold and Silver verses the M2 money supply is at record low levels.
This week’s highlights are the following:
There are two worlds with opposing realities. One is a world of companies that prosper during the current chaos and the accelerated shift to a digital economy and another world that falters with companies that do not adapt.…… and both are very real.
Our NASDAQ All Stars model lives in the prosperous reality up over 43% YTD. (For more info about our NASDAQ100 quant model, click here.)
Stay Safe and Best Wishes for your trading