Why are gold and bonds blink red for S&P 500 News ad

The stock market now Faster and aggressive than when the lick is before, what is good and bad. Since at present there are more participants than in previous years and decades, each step and the situation are assimilated faster from a huge amount of capital and distribution of information, leading to opportunities and risks This was not for the previous generation of traders and investors.

The observation of some of these dangers is the key to these investors to avoid unnecessary losses and failures in their portfolios and the creation of wealth.

Today’s activity in the market has created a warning that no one can ignore anyone that should not ignore it. This reasoning is related to the basics And the expected behavior in the environment.

For this to work, investors will have to understand how to combine points between the price action in ISHARES 20 ETF treasury bond NASDAQ: TLT and other classes of assets that are considered “safe” or attractive for institutional investors, when the risks in the future are too high, for example, as SPDR Gold Alcs NYSEARCA: GLD in goods.

As investors will see, both of these names are currently creating a significant counterclaim for SPDR S&P 500 ETF TRUST NYSEARCA: SpyField

What are the most important indicator

One of the most important factors of any economy is the money itself, their excess or their absence, its costs or cheapness. When it comes to bonds, investors have access to a live quote of the current market value through the profitability that these tools offer.

Looking at the price action in ISHARES 20 ETF treasury bondInvestors can note a decrease by 7.4% over the past 12 months, significantly reducing the S&P 500 index, but this is not the most important. Bond prices are moving back to their productivity. Therefore, this is ETF gives up to 4.4%And this is what it means.

This profitability is a proxy for the value of money today and, therefore, is a proxy for how difficult the enterprises can provide future growth. This profitability tells everyone that money has become much more expensive than it was just three years ago.

The fact that money is currently more expensive on the American consumer, since companies in the discretionary sector of consumers have already shown signs of weakness, since consumers now see that their budgets are tightening and the credit becomes less accessible.

Recent examples LululeMon athletica Inc. Nasdak: Lulu And The Gap Inc. NYSE: GAPPromotions that fell on two -digit interest points during their last quarterly reports on profits and losses.

Gold Signals performance appetite to security

Historically, gold was considered Best inflation and volatility In the markets from -for its limited supply, which not only helps to soften the print of fiat currency, but also provides a simpler mechanism of pricing in unstable markets, such as today’s.

In connection with current negotiations on trade tariffs between the United States and other countries, investors perceive too much risk in American bonds and currency, and the same applies to other international assets. Therefore, the only reasonable approach is to “turn off the risk” and invest in a product such as gold.

This topic can explain a 42% rally that SPDR Gold Sight ETF gives in just 12 months, signaling the explicit rotation and preferences for the advantages that gold can offer in unstable and vague markets, such as the one that the majority experiences today.

Of course, all this behavior, in bonds and gold, will be Ultimately will affect S&P 500 And his current assessment.

Everything comes down to shares

The understanding that more expensive money, as can be seen from bonds, will probably become an oncoming wind in future income, estimates in S&P 500 should inevitably adjust to reflect this fact. Knowing that this fact occurs in each cycle, Investors flocked in gold Instead, but what is really important.

During the so -called “Liberation Day” in April 2025, when President Trump announced Tariffs will be implemented In the economy S&P 500 violated by 20% decrease From his 52-week maximum, throwing him at the official bear.

Since then, the price has recovered in a record time.

Nevertheless, the price, along with the volume, now stopped, simply shying his record high level, which means that confidence and impulse were not enough to complete this step up. This effectively reflects the recent price effect in gold caused by fears caused by bonds.

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