BlackRock Backs Gold Hedge to Market Risk

Cassie Bastien

2/17/2017 9:20:26 AM

Susanne Barton with Bloomberg.com said, "Stocks have rallied to records amid signs of stabilization in China’s economy and bets that President Donald Trump will boost U.S. infrastructure spending, roll back regulations, and cut taxes." Russ Koesterich, who helps manage the $41 billion BlackRock Global Allocation Fund, said that although investors are optimistic, shown in the stock surge and below-average volatility, markets are underpricing global political risks, even recommending Gold as insurance. He added, "Looming elections in Europe and political uncertainty in the U.S. are among developments that could shift investor sentiment." Barton reported, "In the U.S., stocks this week posted the longest rally in three years, inflation indicators have risen and the labor market is strengthening."

• Traders are underpricing political risks.
• Gold has surged 8 percent in 2017 on an uptick in haven demand.
• According to Bloomberg generic pricing, bullion for immediate delivery was 0.1 percent lower at $1,238.15 an ounce at 2:14 p.m. in Singapore.

Extended Silver Price Rally Reaches Critical Resistance

Silver prices have seen a sharp rebound so far in 2017, rising more than 12 percent, James Chen with FXStreet said. This rally for Precious Metals has predictably coincided with a pullback in the U.S. dollar and continued uncertainty on U.S. interest rates. Chen said, "The price of Silver has currently bumped up against the major resistance imposed by a confluence of factors, including a descending trend line outlining the noted downtrend from July, the key 18.00-area support/resistance level, and the 200-day moving average."

Trump is Giving Investors the Playbook

Two leading investment strategists told CNBC Friday that President Donald Trump's promised pro-growth agenda should help drive the stock market even higher. "The bigger thing in the room is amazing economic and earnings momentum across the globe, broadening out," Wells Capital Management's Jim Paulsen said on CNBC's "Squawk Box". "To me, as long as that persists, I think that's the wind under Trump's magic carpet." Jason Trennert of Strategas Research Partners sees Trump as a bigger influence on the market and business than Paulsen does. However, Trennert said that investors wondering when Trump is going to become less confrontational are "missing it." He said, "This guy [referring to U.S. President Trump] is going straight down the middle. He's giving you the playbook, and you either got to get on board or get run over."

• U.S. stock futures were lower this morning after a five-session run of record closes ended for the S&P 500 and NASDAQ yesterday.

At 10:48 a.m. (ET), the APMEX Precious Metals spot prices were:

• Gold, $1,241.80 Down $1.10
• Silver, $18.11 Down $0.06
• Platinum, $1,005.40 Down $9.30
• Palladium, $783.50 Down $11.80

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