Gold Rush Loses Momentum in Runup to Newmont Earnings

Gold was left looking rather ore-dinary this week, with a 5.7% drop on Tuesday marking the metal’s worst day since 2013.

On Wednesday, futures stabilized. Up 0.2%, prices were close to flat, and investors were left to ponder whether factors that led the metal to a historic rally this year will continue to pan out.

Nuggets of Truth

Even with this week’s tumble, bullion investors can take gold comfort in knowing the noble metal, up nearly 60% in 2025, is headed for its best year since 1979. Moreover, what sent gold prices skyrocketing in the first place remains largely unchanged: Central banks are expected to continue diversifying away from the US dollar, Federal Reserve rate cuts that traditionally make gold more attractive are expected and hedge-worthy geopolitical risks are in no short supply.

Kevin Khang, senior international economist at Vanguard, highlighted in a note on Wednesday how gold’s future is situated between two economic outlooks. There’s optimism, he noted, based around the “transformative potential of AI” and the potential that “innovations will provide outsized returns as they transform the economy and industries.” This favors equities and has fueled the year’s stock market rally. On the other hand, there are the “downside risks” like inflation and fiscal deficits in advanced economies that have increased demand for gold. “Ultimately, this rare dual rally reflects a market grappling with both extraordinary promise and profound uncertainty,” he wrote. “We’re at a moment in time where optimism and caution coexist, and where investors must navigate both with care.” Meanwhile, one of the world’s largest gold miners, Newmont, will report its latest earnings today. One analyst warned that the high point of gold’s recent bull run won’t be reflected:

• “For those who think it will be a blowout quarter for Newmont, they may want to temper expectations,” Zacks stock strategist Tracey Ryniec said on Wednesday. “It will be another great quarter like Q2 was, but gold prices didn’t soar over $4,000 an ounce until Q4. Gold prices were mostly in a narrow range of $3,250 to $3,500 for most of Q3, until prices started to break out again at the very end of the quarter.”
• Shares in Newmont rose 0.8% on Wednesday, stabilizing after a 9% drop that coincided with Tuesday’s gold selloff. Miners, which are typically more stable stocks, have had a blockbuster year, with the VanEck Gold Miners ETF up 116%.

Stress Test: A strengthening US dollar and a series of strong earnings reports on Wall Street were among the factors that threw cold water on gold euphoria on Tuesday, but so was an apparent easing of US-China trade tensions. On Wednesday, the geopolitical standoff appeared poised for escalation, as Reuters reported that US officials are considering curbing shipments of goods made with American software to the world’s second-largest economy.