Constellation Energy and FedEx are the focus of attention on Wall Street. The Federal Reserve’s interest rate cut fueled gains for U.S. stocks, with the Dow Jones hitting a new all-time high. The Nasdaq and S&P 500 also saw gains for the week. The Fed’s decision to cut rates and its plans for further cuts were well-received by the market. Constellation Energy saw a surge in its stock price after announcing a new agreement with Microsoft. Meanwhile, FedEx experienced a significant drop in its stock price after falling short of earnings expectations. Gold prices reached a new record high, surpassing the $2,600 mark. Gold recorded a weekly increase of 1.57 percent, pushing its year-to-date surge to 28 percent. The rise in the precious metal was fueled by the shift in Fed policy. Gold tends to perform well in a low-interest-rate environment as it reduces the cost of holding non-interest-bearing assets like bullion. Additionally, the weakness in the U.S. dollar and dollar-related assets provided further support to gold prices.
Treasury yields remained mostly unchanged, with the benchmark 10-year yield at 3.73 percent. The U.S. Dollar Index (DXY), which measures the dollar against a basket of currencies, saw a slight increase to 100.74 but posted a weekly decline of 0.37 percent. A weaker dollar is typically favorable for gold prices as it makes the metal more affordable for foreign investors.
ING adjusted its gold forecast for 2025, predicting an average price of $2,700 per ounce. Ewa Manthey, the bank’s commodities strategist, pointed to factors such as the Fed’s anticipated rate cut, the upcoming election, geopolitical tensions, and central bank demand as drivers of gold’s upward trajectory. Manthey stated that gold prices are expected to average $2,580 in the fourth quarter of this year, with an annual average of $2,388. The momentum is forecasted to continue into the next year, with prices averaging $2,700 in 2025.
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