The FAA administrator's comments come on the eve of his visit to Boeing facilities outside Seattle, Washington. While there, he's scheduled to meet with Boeing executives and...Airlinesread more
CBS, CNN and other major media companies are starting to pull e-cigarette advertising off their airways, as the death toll from a mysterious vaping-related illness continues...Health and Scienceread more
Investors largely expected the FOMC to cut rates by a quarter point.The Fedread more
As the Fed was meeting to consider cutting interest rates, it lost control of the very benchmark rate that it manages.Market Insiderread more
For the past six years, Facebook has tried over and over to release a hardware product that consumers will want, and it has never succeeded.Technologyread more
AT&T is considering selling DirecTV, according to a report in the Wall Street Journal.Technologyread more
The Fed cut interest rates by a quarter point, but it also reaffirmed its rate cut was meant to serve as insurance for the economy.Market Insiderread more
President Barack Obama spoke at an event in San Francisco on Wednesday hosted by software company Splunk and addressed how tech can help solve problems.Technologyread more
Disney CEO Bob Iger writes in his autobiography that he believes he would have discussed combining Disney with Apple had Steve Jobs lived.Technologyread more
The Facebook CEO will talk to policymakers "about future internet regulation," according to a spokesperson.Technologyread more
Microsoft shares rose 1% after hours as it announced plans to raise its dividend and authorized as much as $40 billion to buy back shares.Technologyread more
Goldman Sachs has found the safe haven gold more attractive after a volatile December.
The bank on Thursday raised its gold forecasts to $1,325, $1,375 and $1,425 per troy ounce over the next three, six and 12 months, respectively, from $1,250, $1,300 and $1,350 per troy ounce. Based on gold's current price, that forecast represents a 10.7 percent increase over the next 12 months.
"Going forward gold will be supported primarily by growing demand for defensive assets. The same is also true of central bank buying, with rising geopolitical tensions incentivizing more central banks to re-enter the gold market," Goldman's Jeffrey Currie said in a note to clients on Thursday.
Fears on slowing economic growth and the uncertainties around the Federal Reserve's monetary policy have stirred the financial markets for a few months. Risk assets took a big hit in 2018, with the stock market suffering the worst December since the Great Depression. But during this volatile time, gold has outperformed the markets, returning more than 4 percent since the start of December, according to Goldman. The SPDR Gold Shares (GLD) returned about 5 percent in December.
"The last few weeks have seen a sharp deterioration in risk sentiment following soft macroeconomic data in December and renewed concerns about the future direction of growth, particularly the risk of U.S. growth catching down towards weaker economies," Currie noted.
The double whammy of weaker economic outlook and the Fed's policy uncertainty has spooked the markets. The U.S. manufacturing PMI (Purchasing Managers Index) hit a 15-month low in the same month. Manufacturers' confidence in business also slipped to the lowest level in nearly two years.
The Fed had been tightening monetary policy aggressively. But on Jan. 4 Fed Chairman Jerome Powell signaled Wall Street that policymakers will be patient with policy moves and are attuned to the messages coming from markets. That pause may be the time for gold to outperform, Goldman said.
"Rather, we find that as the hiking cycles matures, the usual (negative) correlations between these indicators and gold starts to weaken, or even turn negative," wrote Currie. "This is because gold begins to price much more off fear of the next recession than off the opportunity cost of holding gold, or the purchasing power of investors / EM households."