Stock markets are in decline this week as investors come to terms with the very real threat of an incoming recession. The S&P 500 and Dow were both down, with the S&P 500 suffering its sharpest first half drop in more than 50 years.
CFRA chief investment strategist Sam Stovall said, “Recession concerns are dominating the market. The real question is if the economy is slowing, then by how much will second-quarter earnings or guidance disappoint. People are waiting until they get some news that could serve as a catalyst.”
Genter Capital Management’s CEO Dan Genter said we may soon start to see the first signs of choppy waters. He warned, “Earnings projections were being artificially held up. Over the next two weeks, everyone is going to start lowering estimates and we expect to see a significant amount of volatility.”
The situation is similar across the Atlantic, with fears also mounting of a recession in Europe reflected in a deceleration in growth for the month of June and surging prices for items such as gas and food.
These signals are all positive for gold’s medium-term outlook and underline the huge amount of support for the precious metal in the weeks and months ahead.
