The conclusion of the 2016 Presidential Election didn’t just rock the political arena – the finance sector and gold markets are buzzing with activity in response. A changing of the guard for a world superpower like the United States creates uncertainty among investors across the globe – and economic uncertainty is a major driving factor for gold prices.
As election results were revealed Tuesday night, stock markets took a plunge while gold prices surged as high as 4% to $1,316 per ounce. That level marked the highest single-day spike for gold since the Brexit vote in late June. The spot Gold prices have since come down as global optimism rebounded and equities rally in response. Gold backed investments, such as stock in mining companies and ETFs, were also doing well, but have moderated as the election news is fully digested. As an example (and not an endorsement), here are some performance snapshots for gold-related funds and companies during the pre-market session on November 9:
- ProShares Ultra Gold ETF (UGL) rose 3.04%
- SPDR Gold Trust ETF (GLD) rose 2.26%.
- Newmont Mining Corporation (NEM) rose more than 5%
- Barrick Gold Corporation (ABX) and Goldcorp Inc. (GG) both rose more than 7%
The equities market has responded very positively to the election results. Longer term, Donald Trump’s nomination could contribute to a significant economic boost. Gold and equities prices will continue to benefit as investors buy up gold as a hedge against inflationary pressure. Since the election news is still fresh, we may see even more price fluctuations for precious metal prices in the near future. If you want to keep a close eye on these trends, download our app to view past and present prices and receive alerts on changes.