With no economic stats and Greece off the front pages, a crash in gold prices might be your best watercooler talk for Monday.
Clearly, the precious metal hasn’t been helped by Friday’s news that China isn’t holding as much gold as originally thought and by signs the Fed will go ahead with an interest-rate hike. But ponder this question from WSJ’s Jason Zweig, posed in a commentary as gold settled at five-year lows Friday (and kept falling Monday): “So why, even as Greece has defaulted, the euro has sunk against the dollar, and the Chinese stock market has stumbled, has gold been sitting there like a pet rock?”
Why, indeed. Our call of the day looks at what strategists are saying about this push further into bear territory for gold. Our chart of the day, meanwhile, looks at a contrarian call that sees gold headed higher, while the S&P 500 moves lower.
While Greece is out of the headlines, its banks have reopened on Monday, and social media is awash with images of long lines of people who’ve been trying to get at their cash for three weeks. Imagine that and being limited to withdrawals of €420 a week at once — that’s $455, instead of only €60 per day.
Don’t forget that this is a huge week for earnings. After Google blew Wall Street away last week, triggering a buying frenzy and helping the Nasdaq COMP, -0.01% to a new closing high, investors will be looking to see if Apple can keep the party going on Tuesday. Microsoft, Yahoo, Coca-Cola, Boeing, McDonald’s and Caterpillar are also reporting this week. (Check out a preview here).
To be sure, investors want to know if the S&P 500 SPX, -0.07% will follow in tech stocks’ footsteps this week. And earnings could make or break that case.