Gold Bears Are Winning for Now. Should Investors Care?

Gold has always had a way of testing investors’ expectations.

Just when the headlines appear most supportive—inflation is rising, geopolitical risk is escalating and confidence in fiat currency is being questioned—gold can suddenly move in the opposite direction.

I get it. To many investors, this behavior can feel frustrating.

But for contrarian investors like you and me, these moments can also create opportunity.

Take a look at the chart below. Our 60-day percentage change oscillator for gold, measured daily over the past five years, shows the metal has moved deep into oversold territory. Historically, readings near these lower bands have represented moments of liquidation and negative sentiment. But they’ve also often marked periods when investors should begin paying closer attention.

When investors believe rates will stay elevated, yields become more competitive with gold, which pays no income. That can create short-term pressure on bullion, even when the long-term case remains intact.

There’s also the matter of liquidity. During moments of market stress, investors sometimes sell what they can, not what they want to. It can be liquidated to cover margin calls, rebalance portfolios or rotate into assets that appear to offer more immediate protection, such as energy stocks during an oil shock.

In other words, short-term selling doesn’t necessarily mean the gold thesis is broken. As I see it, it simply means investors are repositioning in a volatile environment.

The Fundamentals Remain Intact

There are many reasons why I believe the longer-term case for gold remains strong.

First, global debt levels remain historically high. The U.S. continues to run large fiscal deficits, and there’s little political appetite in Washington for meaningful curbs on spending.

Second, central banks around the world continue to view gold as a reserve asset. The World Gold Council (WGC) reports that institutions resumed net gold purchases in April after selling a sizeable amount the previous month.

And third, inflation remains a risk. Even if headline inflation cools temporarily, the structural forces behind higher costs haven’t disappeared. Supply chains remain fragile, while energy markets remain vulnerable to geopolitical disruption.

The Contrarian Setup

A real contrarian opportunity exists when sentiment is negative, but the fundamentals remain intact. The yellow metal appears to meet those conditions today.

The standard deviation chart above gives us the technical signal. Gold is oversold on a 60-day basis relative to its own history. That suggests the recent move may be extended.

On the other hand, the macro backdrop gives us the fundamental support. Inflation, deficits, geopolitical risk and institutional buying remain in place.

The Broader Hard-Asset Story

Gold isn’t the only hard asset worth watching, of course.

Across commodities, supply constraints are becoming more visible. Take aluminum. The Midwest Premium has become a growing share of the all-in U.S. aluminum price, reflecting regional tightness and the higher cost of securing physical supply. Aluminum is currently trading around $3,500 per metric ton, but when you include the historically high premium, U.S. buyers are having to pay over $6,000, according to the Wall Street Journal. For American manufacturers, this affects everything from cars to aircraft to defense systems and infrastructure.

Doctor Copper also remains central to the global economy. The red metal is essential for electrification, power grids, data centers, defense applications and industrial growth. Even if parts of the energy transition slow, the world still needs more electricity, more transmission capacity and more critical infrastructure.

Fitch recently raised several near-term metals and mining price assumptions, including copper and aluminum. For copper, the 2026 price assumption has increased from $11,500 to $12,500 per metric ton. Aluminum’s rose from $2,900 to $3,400 per metric ton.

That’s consistent with what markets are telling us. Supply growth is constrained, permitting remains difficult, inventories are tight and geopolitical risk is adding a new layer of uncertainty.

What Investors Should Watch

For gold, I would watch three key factors.

The first is real interest rates. If markets begin to believe the Fed is ready to start hiking, gold could respond quickly. CME’s FedWatch tool shows that the probability of rates staying pat at the Fed’s June 17 meeting is near 100%. But looking ahead to the end of the year, the probability of rates rising a quarter to half of a percentage point climbs to 41%.

The second is ETF flows. Global gold-backed ETFs saw 2% net outflows last month, according to the WGC, but flows can reverse when safe-haven demand returns.

The third is the miners. Gold equities often lead or confirm turns in the price of bullion. If miners begin to outperform, that could signal renewed investor appetite for the sector.

In short, gold looks oversold right now, at a time when the hard-asset case remains strong. For contrarian investors, that combination deserves consideration. As many of you know, I’ve long believed that investors should consider a 10% weighting in gold and gold-related assets, with 5% in physical gold or bullion-backed exposure and 5% in high-quality gold mining equities.

Airlines and Shipping

Strengths

• The best performing airline stock for the week was LATAM, up 10.5%. The airfare CPI continued to accelerate during the week. It was up 27% in the most recent month, up from 21% the month before, indicating strong pricing power by the airlines, (although the sample is skewed toward discounters and basic fares).
• According to Kawasaki Kisen, containership freight rates have been steadily rising since February. Management commented that this could potentially be due to an accelerated peak season, which in a normalized cycle, would come around summertime in preparation for the Christmas season.
• Boeing reported 60 deliveries in May 2026, up from 45 deliveries in May 2025. Across its 60 deliveries during the month, Boeing delivered 51 737 MAXs, one 737 NG, one 767, one 777F, and six 787s. On a year-to-date basis, total deliveries are up 14% year-over-year, which BMO views as an overall positive for stock momentum.

Weaknesses

• The worst performing airline stock for the week was Cathay Pacific, down 8.5%. In China, ex-fuel ticket price growth softened to +4.6% year-over-year in May and +1.1% in early June 2026, while load factors edged down to 82.3% (-1.2pp), indicating softening demand. Average fleet utilization is down to 6.95 hours (down 0.75 hours) after Labor Day, according to Bank of America.
• Yemen’s Houthis have made another threat to Israeli shipping, according to Reuters. The Red Sea has emerged as a critical shipping route for oil since the closure of the Strait of Hormuz.
• China’s air passenger growth has been under pressure since April as the global energy shock lifted air ticket prices. Morgan Stanley observed a passenger shift from air to rail starting then. Domestic passenger growth slowed to 3-4% year-over-year from 6-10% year-over-year.

Opportunities

• Justin Jones is the new COO at Southwest Airlines and will handle all network operations. This implies that Bob Jordan will stay on as CEO. Andrew Watterson was doing this job previously and has been demoted to operations exclusively, which implies he will not be CEO.
• This past week, laden vessels from China to the U.S. were up sequentially (+1% week-over-week) and on a year-over-year basis (+3% YoY). Data suggests TEUs coming into Port of LA will remain positive next week (+6% WoW) following this past week’s +13% sequential, before seeing an increase of +4% WoW two weeks out, according to Goldman.
• Bombardier announced plans to expand its Singapore Service Centre at JTC’s Seletar Aerospace Park with a new 250,000 square foot facility funded by a local developer. Construction commences in the second half of this year, with operations expected in the second half of 2028. This will double Bombardier’s capacity, according to RBC.

Threats

• Airbus has been notifying some customers of delays on A320neo series jets that are due to be delivered in 2027 and 2028, according to people familiar with the matter. The customers are being told that jets will be delayed by a few months. The aircraft that are most affected are the A321neo type, the longest and most popular version of the A320 family.
• Fuel shortages could idle 10% of the global shipping fleet, according to Mercuria. Refiners are shifting to other derivatives than marine fuel. Diesel is the nearest derivative to marine fuel that ships could use.
• According to Morgan Stanley, key risks for Cathay Pacific include potential operational weakness at HK Express, although a low base in 2025 may help cushion downside. The resumption of direct China–U.S. flights could also present a headwind, though near-term risks appear limited. Additionally, cargo earnings may normalize, as recent strength in air freight rates—partly supported by global capacity adjustments amid the Middle East conflict—may not be sustained.

Luxury Goods and International Markets

Strengths

• Frasers Group, the owner of Sports Direct, has offered to acquire the remaining shares of Hugo Boss for approximately €2 billion. If completed, the transaction would strengthen Frasers Group’s presence in the premium apparel market and further deepen its relationship with one of its key brand partners. Shares of Hugo Boss rose about 10% following the announcement.
• China’s trade has grown strongly, with exports increasing by approximately 19.4% year over year and imports rising 27.4% in May 2026. Export growth was driven by robust global demand for Chinese products such as electronics, electric vehicles, machinery, and other technology-related goods. At the same time, imports increased as Chinese manufacturers purchased more raw materials, energy, and industrial components needed for production.
• The RealReal gained 15.3% over the past five trading days, making it the top performer in the S&P Global Luxury Index. The advance was driven by continued optimism around the company’s profitability turnaround, strong recent operating results, and positive earnings estimate revisions that boosted investor confidence in its growth outlook.

Weaknesses

• Lululemon lowered its full-year sales forecast after reporting weaker-than-expected demand in its key U.S. market. The company revised its revenue outlook from projected growth of 2%–4% to a range of flat sales to a 1% decline, citing sluggish consumer spending, increased competition from brands such as Alo Yoga and Vuori, and product launches that failed to generate strong customer interest.
• U.S. first-quarter household change in net worth was reported at $1.73 trillion, below the consensus estimate of $2.17 trillion. While household wealth still increased during the quarter, the weaker-than-expected gain suggests slower growth in asset values and household balance sheets than economists had anticipated. Additionally, inflation in the United States hit a three-year high.
• Cettire, an Australian online luxury retail platform, was the worst-performing stock in the S&P Global Luxury Index over the past five trading days, with shares falling 10.4%. In the absence of any significant negative company-specific news, the decline likely reflected profit-taking and ongoing concerns about the company’s growth and earnings outlook.

Opportunities

• The FIFA World Cup, featuring soccer—the world’s most popular sport—began this week in Mexico City and will run through mid-July. It is the largest World Cup ever, with 48 teams and 104 matches scheduled across Mexico, Canada, and the United States. The event is projected to contribute approximately $41 billion to global GDP and up to $17.2 billion to U.S. GDP. Hotels, restaurants, and other hospitality-related businesses are well positioned to benefit from increased tourism and economic activity.

• The FIFA World Cup Trophy weighs approximately 6.2 kilograms and is made of 18-karat gold, which is 75% pure. According to BofA Global Research, the value of the trophy’s gold content has increased dramatically from about $25,900 when it was introduced in 1974 to nearly $747,000 today. This increase of almost 2,800% reflects the strong long-term appreciation of gold over the past five decades and underscores the enduring appeal of luxury and prestige.
• In 2025, wind and solar energy in Europe generated about 30% of electricity, slightly surpassing fossil fuels at approximately 29%, marking the first-year renewables exceeded fossil fuels in power generation. Europe is expected to continue benefiting from increased use of renewable energy, which has lower operating costs and does not require fuel purchases. This trend could help reduce electricity prices over time and support economic growth across the region.

Threats

• The European Central Bank (ECB) raised its key interest rates by 25 basis points, marking its first increase since 2023. The move was driven by rising inflation, which has climbed above the ECB’s 2% target, largely due to higher energy prices. The ECB also raised its inflation forecasts and indicated it remains focused on preventing inflation expectations from becoming elevated.
• The ECB’s recent 25-basis-point rate hike could provide additional support for the euro. A stronger euro may create a headwind for European luxury companies by making their products more expensive for international consumers and reducing the value of overseas sales when translated back into euros. Given the sector’s global customer base, currency movements remain an important factor to monitor.
• Geopolitical tensions remain elevated, as conflicts in the Middle East and unrest in several regions continue to create uncertainty for global markets. The United States recently imposed sanctions on several China- and Hong Kong-based entities accused of helping Iran procure military-related equipment, highlighting growing concerns over regional security. Ongoing wars, political instability, and rising geopolitical risks remain a potential headwind for consumer confidence and luxury spending.

Energy and Natural Resources

Strengths

• The best performing commodity for the week was coffee, up 4.67%. Coffee prices have a notable tailwind building, with persistent dryness in central Brazil keeping conditions unfavorable for the trees, just as El Niño emerges as a potential major disruptor, clouding the outlook for the 2027 crop even amid a record current harvest.
• Valero has stood out as a clear beneficiary of the current oil price environment, with refining margins remaining elevated above pre-conflict levels even after easing from their mid-May peak. With product inventories tight and demand staying steady, crack spreads are likely to remain supported, reinforcing Valero’s earnings strength even if the Strait of Hormuz reopens. Valero is also benefiting from elevated prices for sulfuric acid, which it produces from refining high-sulfur crude oil.

• For the first time ever, solar power outpaced coal in U.S. electricity generation during a calendar month, supplying 12.8% of the mix in May versus coal’s 12.2%, according to a new report from think tank Ember. The milestone reflects surging AI data center demand pushing utilities toward cheap, quick-to-deploy solar paired with batteries, which accounted for 91% of new U.S. capacity additions in the first quarter, even as federal policy continues to favor traditional sources like coal and nuclear.

Weaknesses

• WTI crude oil was the weakest performing commodity of the week, declining approximately 6.8%. Oil fell sharply this week as the U.S. and Iran moved closer to an interim peace deal that would reopen the Strait of Hormuz, with President Trump canceling imminent airstrikes and signaling an agreement could be signed as soon as next week. Brent dropped more than 1% on Friday to below $90 per barrel, down from a late-April high of $125, as traders priced in de-escalation rather than a resumption of all-out conflict.
• Chinese zinc smelters are facing compressed margins as treatment charges on imported concentrate plunged to a record low of minus $50 per ton, driven by a feedstock shortage stemming from disrupted Iranian supplies, weaker Russian mine output, and halted Cuban shipments. Smelters began cutting production last month and may expand curtailments through the summer, though the resulting easing of China’s domestic surplus should help keep zinc prices elevated after their 14% rise this year.
• U.S. LNG developers expected Europe to anchor demand for their next generation of export projects, but the region is increasingly avoiding the long-term contracts needed to finance them. Only one new U.S.–Europe deal has been signed this year versus six in 2025, as buyers grow wary of overreliance on the U.S. The pullback reflects strained transatlantic relations and a growing preference for spot markets, pushing U.S. suppliers to pivot toward Asian buyers such as Taiwan and India in an effort to secure long-term contracts before new construction begins.

Opportunities

• With the June 30 deadline for the U.S. Commerce Secretary’s recommendation approaching, expectations are rising that a phased tariff on refined copper will be confirmed, prompting analysis of likely impacts on spreads, inventories, and prices under various scenarios. Even in the most bearish case, any LME price pullbacks are expected to be quickly bought by China at an ever-higher floor of roughly $13,000 per ton, with copper prices likely touching new highs over the summer absent a macro-driven demand shock.
• The U.S. Department of Energy approved the Preliminary Documented Safety Analysis for Oklo’s Aurora powerhouse at Idaho National Laboratory, marking a major step in the Reactor Pilot Program authorization pathway covering hazard analysis, accident analysis, safety controls, and design commitments. Oklo, which broke ground on Aurora-INL in September 2025, expects to gain early deployment and operating experience through the program while pursuing separate NRC licensing to support future commercial operations, another sign of accelerating U.S. advanced nuclear development.
• FERC approved PJM’s expedited interconnection track, which will fast-track up to 10 interconnection requests annually through 2027 for new or uprated capacity resources of at least 250 MW that can come online within three years and have backing from a state’s primary siting authority. The commission rejected protests from Vistra, state regulators, and others, framing the time-limited process as a way to address PJM’s tightening supply situation driven by data center demand growth, with the first selected projects potentially announced in October.

Threats

• FGE’s Fereidun Fesharaki forecasts oil could reach $150 per barrel by July or August if the Strait of Hormuz remains effectively closed, and potentially approach $200 by year-end as global inventories continue to decline into the summer driving season. While a similar call he made in March did not materialize, with Brent peaking at $126 in April before retreating to the mid-$90s, he argues the pressure point will arrive by mid-to-late July when U.S. stockpiles, already near operational minimums at Cushing after seven consecutive weeks of declines, reach a bottom.
• A new BMO report argues that ongoing Section 301 investigations in Washington into forced labor practices and structural excess capacity represent the most significant change to the U.S. tariff regime since Liberation Day, yet have drawn limited market attention. BMO sees a strong chance that a quasi-universal tariff of roughly 20 to 25 percent emerges in the second half of 2026, potentially reviving commodity frontloading dynamics and reinforcing stagflation and currency debasement concerns that have weighed on risk assets.
• The Trump administration declared a power emergency in the southeastern U.S. ahead of a dangerous heat wave, with a Department of Energy order allowing Duke Energy to run plants at maximum output and exceed certain air pollution limits to meet soaring demand in the Carolinas through Friday night. The heat is straining grids along the East Coast, with PJM Interconnection’s real-time power prices surging past $1,300 per megawatt-hour and grid operators in New York and New England preparing emergency measures as the heat index nears 100°F, highlighting how little slack remains in the system as data center load grows.

Bitcoin and Digital Assets

Strengths

• The tokenized real-world asset (RWA) market reached a record $28.9 billion in May, marking its tenth consecutive monthly all-time high, while the stablecoin market capitalization climbed to a record $320 billion. Tokenized Treasuries grew to $16.2 billion, and tokenized equities rose 20.4% to $2.41 billion, highlighting continued institutional adoption of blockchain-based financial products despite broader digital asset market weakness.
• Japan’s parliament is advancing legislation that would classify cryptocurrencies as financial instruments under the Financial Instruments and Exchange Act, paving the way for products such as crypto ETFs and stronger investor protections. The move comes as the country surpasses 14 million crypto accounts, highlighting growing mainstream adoption and further integration of digital assets into traditional financial markets.
• BlackRock is preparing to launch the iShares Bitcoin Premium Income ETF (BITA), an income-generating bitcoin strategy built on its $47 billion IBIT spot Bitcoin ETF. The fund will generate yield by selling call options on a portion of its holdings and will charge a 0.65% fee, undercutting competing Bitcoin covered-call products. The launch reflects continued innovation and growing institutional demand for diversified Bitcoin investment strategies.

Weaknesses

• Corporate Bitcoin accumulation has slowed significantly, with daily purchases by digital asset treasury companies falling from more than $500 million per day in April and May to nearly negligible levels in June. The decline comes alongside continued ETF outflows, which have exceeded $5.7 billion since mid-May, removing two major sources of demand and contributing to Bitcoin’s recent drop from roughly $74,000 to below $60,000.
• JPMorgan said the retreat from the “debasement trade” has accelerated for Bitcoin. The debasement trade refers to investors buying assets such as Bitcoin and gold as protection against inflation, rising government debt, currency depreciation, and a weakening U.S. dollar. According to the bank, investors have continued reducing exposure to both assets through ETFs and futures markets, with allocations falling back to levels last seen in March 2025, signaling weaker demand for Bitcoin as a store-of-value asset.
• Bitcoin demand continues to weaken, with CryptoQuant reporting a contraction of 652,000 BTC last week, the largest decline since January 2022. The firm also noted that Bitcoin is trading only about 9% above its realized price of $53,600—the average price at which coins last changed hands—while ETF demand is shrinking at the fastest pace since U.S. spot Bitcoin funds launched in January 2024. Investors realized losses of approximately 187,000 BTC over the past 30 days, well below the 400,000 BTC recorded in February 2026 and the 1.2 million BTC seen during the November 2022 market bottom. While this suggests the market has not yet experienced the widespread panic selling often associated with major cycle lows, it also highlights continued weakness in demand and institutional participation.

Opportunities

• Tether led a $1.4 billion funding round in German robotics startup Neura Robotics, one of the largest investments in physical AI on record. The company, valued at up to $12 billion, aims to produce 5 million AI-powered robots by 2030 and has already secured roughly $1.2 billion in orders. The partnership also envisions robots equipped with blockchain-based wallets capable of autonomously receiving and making payments, highlighting the growing convergence of artificial intelligence, robotics, and digital assets.
• Citigroup launched Digital Depositary Receipts, a blockchain-based product that provides institutional and accredited investors access to private company equity through tokenized securities. The initiative targets the rapidly growing private markets industry, which now exceeds $15 trillion in assets, while reinforcing momentum behind real-world asset tokenization, a market some analysts estimate could reach trillions of dollars by 2030. The move underscores how major financial institutions are increasingly integrating blockchain technology into traditional capital markets.
• SpaceX shares will begin trading on Solana through a tokenized security called SPCX on the same day the company is expected to list on Nasdaq. The structure allows investors to convert shares into blockchain-based tokens and back again, enabling 24/7 trading and self-custody. The launch highlights growing momentum behind tokenized equities, a market that could eventually tap into the more than $60 trillion U.S. stock market while building on the success of stablecoins and other tokenized real-world assets.

Threats

• A U.S. appeals court upheld the fraud and conspiracy convictions of FTX founder Sam Bankman-Fried, rejecting arguments that his trial was unfair. The ruling reinforces the legal consequences of one of the largest corporate failures in crypto history and serves as a reminder of the reputational and regulatory risks that continue to weigh on the digital asset industry.
• A new report estimated that U.S. users placed between $11 billion and $34 billion in bets through offshore prediction market platforms that are not authorized to operate in the country. The findings could increase regulatory scrutiny of blockchain-based prediction markets, particularly as the sector grows rapidly and relies on cross-border platforms that may not fully comply with U.S. licensing and compliance requirements.
• Several major crypto exchanges, including Bybit, Binance, and Bitget, were forced to cancel planned allocations of tokenized SpaceX shares after failing to secure sufficient underlying stock to meet investor demand. The incident highlights ongoing challenges around liquidity, asset sourcing, and scalability in the rapidly growing tokenized equities market, raising questions about platforms’ ability to deliver adequate exposure as demand increases.

Defense and Cybersecurity

Strengths

• Credo Technology Group advanced AI infrastructure by launching its Cardinal 1.6T optical processors and completing the strategic acquisition of DustPhotonics. This combination helped drive an estimated 157% year-over-year revenue growth, reinforcing the company’s strong position in the semiconductor and AI computing market as of June 2026.

• Google has ordered over 3 million AI chips from Intel for production in 2028. The move complements its custom TPU strategy and helps address foundry capacity constraints.
• Anthropic released its most powerful Claude Fable 5 AI model to the public as part of its Mythos-class series. The model includes enhanced security-focused safeguards, restricting responses to queries that could be used to exploit potential vulnerabilities.

Weaknesses

• SoftBank’s negotiations for a $6 billion margin loan backed by its stake in OpenAI have stalled after international lenders questioned the underlying valuation of AI assets. The credit deadlock triggered an immediate 10% drop in SoftBank’s equity, highlighting institutional resistance to unbacked generative AI capital expenditures.
• Kuwait said Iranian strikes targeting its territory on Thursday morning forced a temporary airspace closure and damaged an airport radar, causing injuries.
• British Defence Secretary John Healey resigned, warning that the Starmer administration’s delayed Defence Investment Plan falls short of required spending. Healey criticized the Prime Minister and Treasury for failing to commit necessary capital amid multi-theater escalations involving Ukraine and Iran, creating friction in Western European defense procurement.

Opportunities

• OpenAI’s proposed 10-gigawatt Ohio facility, expected to cost at least $500 billion under a 20-year lease, represents a major new data center investment highlighting the ongoing expansion of AI compute infrastructure.
• A federal judge ruled the $100,000 H-1B visa fee illegal, potentially easing talent acquisition pressures for tech employers such as Amazon by improving access to skilled international workers.
• Meta has entered into a 900 MW renewable energy partnership in India, adding more than 800 MW of solar and wind capacity, underscoring its focus on long-term power supply and sustainability commitments.

Threats

• The Reuters v. ROSS Intelligence appellate hearing on June 11, 2026, highlighted a potential structural risk for the AI industry, as judges expressed skepticism over the use of proprietary datasets under “fair use” protections. AI defense attorneys warned that an adverse ruling could threaten the foundations of generative AI by triggering costly data licensing requirements.
• Russia is reportedly preparing to station up to 115,000 troops near the borders of NATO’s Nordic and Baltic members following the war in Ukraine.
• Amazon Web Services sparked debate on social media after publishing a statement warning that flooding systems with AI-generated code can slow software teams rather than speed them up. AWS emphasized that release execution and debugging are the primary bottlenecks, arguing that organizations should prioritize code quality over quantity.

Gold Market

This week gold futures closed the week at $4,231.30, down $134 per ounce, or 3.07%. Gold stocks, as measured by the NYSE Arca Gold Miners Index, ended the week higher by 0.09%. The S&P/TSX Venture Index came in up 2.05%. The U.S. Trade-Weighted Dollar fell 0.29%.

Strengths

• The best performing precious metal for the week was palladium, up 2.41%. The World Cup kicks off this week, where one hard-working, intense team with a proven process will ultimately hoist the trophy. We see that journey as remarkably similar to the process miners undertake to recover gold from the ground, both require patience, discipline, and a refined approach repeated again and again before the payoff. Fittingly for such an electric event, we looked at how the price of the gold in the trophy has performed over time, a reminder to stay the course with hard work and a proven process.

• Asian-based ETFs have continued to accumulate gold even as U.S. and European holdings have rolled over, with the metal now down about 25% from its January closing high and finding some support around the $4,000 level. Chow Tai Fook shares surged as much as 13% after FY26 net income rose 52% to HK$9.0 billion and FY27 guidance beat expectations, driven by a recovery in weight-based gold jewelry demand as prices pulled back, with April and May same-store sales up 19.7% in mainland China and 40.6% in Hong Kong and Macau.
• Scotia analyzed several valuation metrics, including free cash flow yield, EV to EBITDA, price to cash flow, and price to net asset value, to assess where gold equities are trading today versus historical valuations going back to the 1970s. In short, gold equities are trading at very attractive valuations across these four metrics at spot gold prices compared with historical levels.

Weaknesses

• The worst performing precious metal for the week was platinum, down 4.45%. Platinum faced notable weakness as ETFs cut 46,948 troy ounces from their holdings in the latest session, a 1.6% daily drop that brings year-to-date selling to 15%, the steepest decline among the precious metals. The selling pressure reflects heightened volatility tied to war-related developments, with investors paring back exposure as shifting geopolitical headlines drove sharp swings across the complex.
• Resolute Mining recently reported that security concerns throughout April and May impacted the delivery of key equipment, which in turn affected mining of higher-grade zones in the A21 pit. The company also flagged that underground grades have been lower than expected due to intermittent blasting as a result of temporary explosives supply issues, and that maintenance downtime originally planned for May has been deferred into June 2026 and extended. As a result, Resolute Mining expects a negative impact on Q2 production and is now targeting the lower end of FY guidance, according to Canaccord.
• The ECB noted that following the outbreak of war in the Middle East, some central banks sold gold and U.S. Treasuries to support their economies and currencies. The Turkish central bank sold or loaned out about 130 tons of gold, one of the largest reserve drawdowns in recent years, to defend its currency, mitigate rising energy import costs, and manage economic fallout. In 2026, besides Türkiye, other known sellers include Russia, reportedly to fund its ongoing war against Ukraine.

Opportunities

• According to RBC, junior gold EV per ounce valuations have increased materially from mid-2025 levels, clearing the prior cyclical highs set in 2020. Across the 90 plus companies RBC tracks, valuations are now estimated at $80 per ounce, up from $30 per ounce as of mid-2025. When measured as a percentage of the gold price, valuations have also increased but remain near cyclical lows, indicating the sector has not fully kept pace with gold’s rise over time.
• Northern Star Resources, according to Bloomberg, has received multiple takeover offers over the past year. Elliott Management, which holds a 4% stake, is suggesting that the company should be sold.
• The Gold Miners Bullish Percent Index has at one point collapsed to around 7.7, a washout reading seen only a handful of times in the past decade, including the March 2020 crash, the late 2022 bottom, and the 2023 low, each of which marked major buying opportunities before strong rallies in the sector. Historically, readings below 10 have signaled peak capitulation in gold miners, suggesting current extreme pessimism may once again be setting the stage for a significant rebound.

Threats

• Countries with potential royalty policy changes include Panama, Chile, Papua New Guinea, and Indonesia. Sliding scale royalties are also common in South America and Africa, although some countries do not currently use this structure and may adjust policies to align with regional peers, according to Scotiabank.
• Citigroup lowered its three-month price target for gold to $4,000 per ounce from $4,300, as the impasse over the Strait of Hormuz and elevated energy prices raise expectations that the Federal Reserve will hike interest rates this year. Analysts including Kenny Hu noted that softer physical demand may further weigh on prices.
• According to Bank of America, gold faces limitations as an official reserve asset compared with major fiat currencies. Its price is volatile, it is not remunerated, and when held in physical form it is costly to store. More importantly, supply is not fully elastic and does not adjust smoothly to shifts in international demand for liquidity.

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