Gold soars to new heights as Dollar dives, NVDA takes a tariff tumble

And the volatility continues….stocks slipped yesterday….The Dow down 155 pts, the S&P down 10 pts, the Nasdaq down 8 pts, the Russell up 2 pts, the Transports down 150 pts, the Equal Weight S&P down 20 pts, while the Mag 7 lost 123 pts.

Bonds rose – the TLT up 0.35% while the TLH gained 0.3%. Leaving the 10-yr yielding 4.33%, while the 2 yr is yielding 3.81%.

Gold continued to march higher yesterday up $20 and this morning it is surging – up another $80 – now trading into another new century…..$3,322/oz….Just to be clear – in January 2024 – gold was trading at $2200 – today it is trading at $3300 an oz…that is a 50% move in 16 months….moving to record highs on a mix of issues. Many of which you know – but if you don’t here we go.

Geo-political tensions that include the ongoing wars in Ukraine/Russia, Iran (Hamas & Hooties & the Red Sea)/Israel only amplify global instability causing investors to flock to gold. (Granted we have not heard much of this lately – because of the trade war that has taken center stage).

Tariff induced uncertainty that only appears to be getting worse between the US and China. Then you have Central bank buying…..emerging countries like China, Russia and India (yes they are all ‘emerging’) are buying up gold like there is no tomorrow….the news refers to it as a ‘record pace’ – all driven by the desire to reduce their reliance on the dollar and as a hedge against tariffs and sanctions…

And then you have the weakening US dollar – 9.5% since the January high of 110 – trading at 99.63 this morning. a weaker dollar is a plus for gold and other commodities…. A weaker dollar makes gold more attractive to foreign buyers. (the dollar is weaker due to all of the same issues in addition to the uncertain FED policy).

And then you have retail demand surging…. Have you seen the gold bars in Costco (they just pile them up on the floor!) and so, Gold continues to climb…..Shall I go on?

And then overnight we got some more news out of NVDA – you know them right? CEO Jensen Huang now projecting a $5.5 billion hit due to restrictions on AI chips into China and that is sending NVDA down 5% pre-mkt. AMD – 6%, ASML – 4%. The Nasdaq is down 240 pts in the pre-mkt. This projection only escalating the battle between Donny and XiXi and my friend Dan Ives – the ‘voice’ on TECH on the street – tells us that we are heading into the ‘eye of the storm’ and does not expect to see tech companies offer a lot of forward guidance this qtr….Which does not mean the bottom will fall out, it just means we will hit a bit more turbulence…. (And this is just another reason that investors pile into gold….).

Now my friend Adam Johnson (on Mornings with Maria) reminds us of that NVDA will earn $225 billion this year and that translates into about $101billion in profits…. PROFITS – so the one-time $5.5 billion hit (while still not welcomed) is more like a pimple on XiXi’s A..! (LOL).

Remember – if we get just ONE trade deal – all of this will settle down – So, I say – get going…. show the markets what good trade deal is. And all you need is one, the others will follow.

Now out of the 11 S&P sectors – we do have 3 winners….Healthcare +0.1%, Utilities + 2.6% and Consumer Staples + 3.1% - all of the other sectors are getting a bit beaten up with Consumer Discretionary in the lead – down 15.8%, Tech down 13.6%, Energy – 7.7%, Industrials – 4.4%, Basic Materials – 3.9%, Financials – 2.1% and Real Estate down 2%. Considering that the S&P is down 8%, Nasdaq down 12.8% and the Russell down 15.5% - 9 of the 11 sectors are actually ‘outperforming’ the broader mkt. (Down LESS than).

Further down the list – we have more losers than winners – but there are winners….All the contra trades are up - DOG + 4.9%, SH + 7.9%, PSQ + 8.9%, VIXY + 47%, SPXS + 15.3%, Gold +31%, Bonds – TLT + 0.5%, TLH + 1.2% and the AGG +1%, Emerging Markets – EEM +0.7%.

Losers include: Homebuilders – 12.8%, Retail – 17%, Airlines -24%, Disruptive Tech – 18%, the growth trade – SPYG – 10%, value trade – SPYV – 5.8%, Metals and Miners – 4%, Semi’s – 19%, Cybersecurity – 0.2%, Aerospace and Defense – 1.3%.....Big Pharma – 3.3%....

And today it is all about RETAIL SALES data…..this speaks directly to the consumer….analysts will try to create a narrative about how YOU are feeling based on these numbers…..Now, Retail Sales m/m are expected to be up 1.4% (vs. the +0.2% last month), Ex autos and gas of +0.6% (vs. +0.5% last month) – both of these would be solid numbers…and would suggest that YOU are just fine…..a result that is weaker will cause analysts to start screaming that YOU are not fine and that the FED needs to CUT rates now!. Something that I do not believe will happen…in fact, I am still in the camp that we won’t get any rate cuts this year…..but I am not a voting member, in fact, I am not even a FED member! But I do have an opinion!

Overnight stocks in Asia were lower…. not a surprise…..all markets (except China and Australia) were down more than 1%. Taiwan and Hong Kong fighting for the win at -1.9% each.

In Europe – investors are pulling back on the buy algo’s.. Mkts there are in cautious mode……all down between 0.3% and 0.75%.

And US futures? They are churning lower as well…. this morning driven mostly by the NVDA headline…..remember, investors, traders and algo’s remain a bit cautious as the headlines over tariffs/trade remain very ‘fluid’, positive one day, negative the next. Dow futures down 55 pts, the S&P’s down 40 (that’s the tech names pulling it lower), the Nasdaq down 260 (again tech), while the Russell is -7.

Just to be clear - this is not over yet…. We are now getting into the ‘meat and potatoes’ of earnings season…. investors will try to focus on the individual reports and react accordingly…..but let’s be honest…..in the end – it will continue to be the news out of DC that will continue to dominate the headlines, so expect the turbulence to continue.

The S&P closed at 5396 – down 10 pts… – the earnings parade continues…this morning we already got 3 reports…..CFG, FHN and USB all reported and beat the expectations….tomorrow brings us AXP, BX, UNH, TFC, SCHW, DHI, KEY, LVS, ALLY, STT - again it’s what these CEO’s say about the next 6 months and beyond. There are only 2 more trading days this week – Friday – mkts are closed for Good Friday and on Monday markets across Europe are closed for Easter Monday…so expect volumes to decline a bit – which could mean volatility increases a bit.

Again, my sense is still that we are closer to a bottom than not….. We remain in the 4835/5775 trading range, but I do expect that we test it to make sure that the buyers defend the position….…We just need more clarity and finality on trade……. Period.

Greek style lamb for Easter

This is a simple and delicious recipe – you gotta try it.

For this you need – Leg of lamb – deboned. Potatoes, bell peppers, red onions & tomatoes, Dijon mustard, garlic, lemon, s&p, thyme, oregano, dried parsley. Olive oil & red wine vinegar and white wine.

Preheat your oven to 375 degrees.

Ok – start by taking the lamb and make ‘slits’ (do not cut it all the way thru) all across it…. Then season with the seasoning, rub with mustard, now add the diced garlic (a lot of it) to the slits. Now Flip it over and repeat.

Now place the lamb in a large bowl and splash with red wine vinegar, olive oil (rub) and the squirt of fresh lemon juice and 1 cup of white wine (I use Pinot Grigio Santa Margherita) – set it aside.

Now slice all of your veggies and place in the baking pan – lined with parchment paper – season with s&p and oregano and a splash of olive oil. Toss to coat. Now place the lamb on top of the veggies and cover tightly with the parchment paper…

Place in the oven and let it cook for at least 2 hrs…. check and then let it cook for another 30 mins…. again, check for doneness.