“The fact that the leading U.S. equity indices closed at record highs yesterday – which could prompt investors to switch once again from gold ETFs to equities – is problematic for gold,” Eugen Weinberg, head of commodity research at Commerzbank, said in the Reuters article. “Any prolonged recovery of the gold price is almost inconceivable unless the ETF outflows abate.”
The SPDR Gold Trust (NYSEArca: GLD) holds about 30.2 million ounces of physical gold, which is at a 4 1/2 year low. Over the past week, GLD lost $1 billion in assets, the largest biggest weekly loss of 2.6% since the end of April, according to IndexUniverse data. [Gold ETFs Still Bleeding Cash]
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Max Chen contributed to this article.
Full disclosure: Tom Lydon’s clients own GLD.