Gold’s first-quarter performance
Gold prices (GLD) gained just 0.6% in the first quarter compared to the gain of 13% in the S&P 500 Index (SPY) and the gains of 11.1% and 16.5%, respectively, recorded by the Dow Jones Industrial Average Index (DIA) and the NASDAQ Composite Index (QQQ).
The markets gained mainly as the Fed turned around on its hawkish stance at the beginning of 2019. Optimism surrounding trade talks between the United States and China also supported the markets during the quarter. Gold prices remained weak as investors flocked to risk assets and shunned safe-haven assets.
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Gold’s drivers going forward
The major drivers for gold going forward in 2019 will likely be the Fed’s tone and the market sentiments regarding global slowdown concerns. If slowdown concerns persist and the yield curve remains inverted for a long time, gold’s demand should increase, supporting its price.
Gold miners’ performances
The VanEck Vectors Gold Miners ETF (GDX) rose 6.3% in the first quarter of 2019. Gold mining stocks’ performances varied widely in the quarter depending on their fourth-quarter performances and their 2019 outlooks.
In the first quarter, all major senior and intermediate gold miners gained except for IAMGOLD (IAG), which fell 5.7%. In the quarter, Eldorado Gold (EGO) rose the most at 60.8%, while Goldcorp (GG) and Yamana Gold (AUY) rose 16.7% and 10.7%, respectively. Agnico Eagle Mines (AEM), Kinross Gold (KGC), Newmont Mining (NEM), and Barrick Gold (GOLD) saw single-digit rises of 7.7%, 6.2%, 3.2%, and 1.3%, respectively.