{"id":293331,"date":"2020-07-31T05:37:09","date_gmt":"2020-07-30T19:37:09","guid":{"rendered":"https:\/\/www.gomarketingteam.com\/articles\/a-gold-and-tech-rally\/"},"modified":"2021-02-19T12:13:37","modified_gmt":"2021-02-19T01:13:37","slug":"a-gold-and-tech-rally","status":"publish","type":"post","link":"https:\/\/www.gomarkets.com\/en\/articles\/economic-updates\/a-gold-and-tech-rally\/","title":{"rendered":"A Gold and Tech Rally"},"content":{"rendered":"

By Deepta Bolaky<\/strong>
\n\u00a0@DeeptaGOMarkets<\/a><\/p>\n

Covid-19 Cases and Vaccine Optimism<\/strong><\/h4>\n

The virus continues to spread across the world, with more than 17 million confirmed cases of coronavirus and 670, 000 deaths. Many countries have seen a surge in the number of infections over the months. As the month comes to an end, we note that countries that have initially successfully controlled the outbreak are now experiencing a rise of cases again. Pfizer, BioNTech, Moderna<\/a> and AstraZeneca <\/a>have all issued positive vaccine updates that have increased expectations of a potential vaccine in early 2021. The US remains among the worst-hit countries, but now Europe is under the radar over fears of a second rise in cases.<\/p>\n

As virus cases continue to surge, investors fret of a deeper recession. Earlier this week, the preliminary GDP figures show that the US is poised to shrink by a 32.9% – the deepest decline in decades. The pandemic continues to wreak havoc across the globe and the outlook for the third quarter remains murky.<\/p>\n

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Gold Rally<\/strong><\/h4>\n

Gold has been on an unstoppable rally recently as investors are hedging with safe-haven assets given the ongoing uncertainty and geopolitical tensions. The fears of a second wave and the prospects of rolling back reopening measures are overshadowing the recovery outlook. The path of the global economy remains dependent on the course of the virus. Towards the end of the month, the uncertainty around the US next stimulus package has also pushed the precious metal higher. The XAUUSD pair broke the record high seen during September 2011 and rose to an all-time intraday high at $1,981.<\/p>\n

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\nSource: Bloomberg<\/p>\n

Towards the end of the month, the precious retreated from recent highs and suffered its first loss in ten sessions dragged by positive vaccine updates and a tech rally. As of writing, the pair is currently trading at around $1,967.<\/p>\n

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\nSource: Bloomberg<\/p>\n

Where is the next target level?<\/strong> In the face of uncertainties, gold is gaining momentum due to a number of factors ranging from the global economic crisis, US election, stimulus packages, continued spread of the virus, geopolitical tensions between US and China, and a fragile rally in the stock market among others. Many big banks struggle to agree on the next level after the gold broke the $2,000 mark. The pace of the rally have moderated and gold may be subjected for a correction but the fundamentals remain bullish.<\/p>\n

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\nSource: Bloomberg<\/p>\n

Earnings Season \u2013 Tech Rally<\/strong><\/h4>\n

After a busy month on the earnings front, mega-cap tech-related firms like Alphabet, Amazon, Apple and Facebook stood out as they reported strong earnings report showing the resilience of the big tech companies.<\/p>\n