Core Viewpoint - The precious metals sector experienced a strong rally, with significant gains in various companies, driven by a rebound in gold and silver prices [1] Group 1: Market Performance - Southern Copper Corporation (SCCO.US) rose over 7% - Freeport-McMoRan Copper & Gold (FCX.US) and First Majestic Silver (AG.US) increased by more than 5% - Pan American Silver (PAAS.US) gained over 4% - Newmont Corporation (NEM.US) saw an increase of over 3% [1] Group 2: Price Movements - Spot gold surged over 5%, surpassing $4,900 - Spot silver jumped over 12%, reaching $88.76 [1] Group 3: Analyst Insights - UBS Global Research analyst Joanie Teves released a report indicating that while gold faces short-term price pressures, the long-term outlook for the precious metals market remains positive - Teves is optimistic about gold's long-term prospects, citing global financial system uncertainties and economic concerns as factors that will continue to drive demand for gold - The advantages of gold as a safe-haven asset will become more pronounced amid changes in Federal Reserve policy and escalating international political risks, suggesting significant upside potential for gold prices in the long term [1]

Core Viewpoint - The precious metals sector experienced a strong rally, with significant gains in various companies, driven by a rebound in gold and silver prices, indicating a positive outlook for the long-term precious metals market despite short-term risks [1] Group 1: Market Performance - Southern Copper Corporation (SCCO.US) rose over 7% - Freeport-McMoRan Copper & Gold (FCX.US) and First Majestic Silver (AG.US) increased by more than 5% - Pan American Silver (PAAS.US) gained over 4% - Newmont Corporation (NEM.US) saw an increase of over 3% [1] Group 2: Price Movements - Spot gold surged over 5%, surpassing $4900 - Spot silver jumped over 12%, reaching $88.76 [1] Group 3: Analyst Insights - UBS Global Research analyst Joanie Teves released a report indicating that while gold faces short-term price pressure, the long-term outlook remains positive - Teves believes that uncertainty in the global financial system and concerns about future economic trends will continue to drive demand for gold - The advantages of gold as a safe-haven asset will become more pronounced amid changes in Federal Reserve policy and increasing international political risks, suggesting significant upside potential for gold prices in the long term [1]

Core Viewpoint - Mining stocks Newmont Corporation and Freeport-McMoRan Inc experienced price movements influenced by external factors, particularly the nomination of Kevin Warsh for Fed chair, which affected gold and silver prices and the U.S. dollar. Group 1: Newmont Corporation (NEM) - NEM shares increased by 1.7% to $114.26 after a significant drop of 11.5% on Friday, marking its worst day since October 2024, following a record high of $134.88 on Thursday [2] - Despite the recent volatility, NEM shares have a 170% year-over-year gain and remain above their ascending 40-day moving average [2] Group 2: Freeport-McMoRan Inc (FCX) - FCX shares were down 0.6% to $60.57, with support from the 20-day moving average mitigating the impact of Friday's pullback from an all-time high of $69.44 [3] - Over the past 12 months, FCX stock has achieved a 69% gain [3] - Both NEM and FCX have shown tendencies to exceed option traders' volatility expectations, with Schaeffer's Volatility Scorecards rating them at 83 and 82 out of 100, respectively [3]

Group 1: Market Reaction - The prices of gold and silver experienced significant declines, with gold dropping over 12% to a low of $4682 per ounce, marking the largest single-day drop in 40 years, and closing down 9.25% at $4880 per ounce [2] - Silver saw an unprecedented drop of over 36%, reaching a low of $74.28 per ounce, and closing down 26.42% at $85.259 per ounce [2] - The U.S. stock market indices collectively fell, with the Dow Jones down 0.36%, S&P 500 down 0.43%, and Nasdaq down 0.94%, reflecting increased market concerns [3] Group 2: Influencing Factors - The sell-off in gold and silver was triggered by a rebound in the U.S. dollar, following reports of President Trump's nomination of Kevin Warsh as the new Federal Reserve Chairman, which was later confirmed [2][4] - Standard Chartered's global head of commodity research noted that the market was already due for a correction, and the announcement of the Fed Chair nominee, along with broader macroeconomic factors, acted as catalysts for profit-taking [2] - The U.S. dollar index saw a significant increase, marking its largest single-day rise since July of the previous year, which negatively impacted investor confidence in gold and silver [2] Group 3: Sector Performance - The gold sector faced substantial losses, with major companies like Newmont down 11.52%, Barrick Gold down 12.09%, and AngloGold down 13.28% [3] - The technology sector also experienced declines, with major tech stocks like Meta and TSMC dropping nearly 3%, while Amazon fell by 1% [3] - Chinese concept stocks saw a downturn, with the Nasdaq Golden Dragon China Index closing down 2.36%, and individual stocks like Bilibili and Li Auto dropping over 3% [3]

Core Viewpoint - The article discusses a significant drop in gold and silver prices, attributed to the market's reaction to Trump's nomination of Kevin Warsh as the Federal Reserve Chairman, which is perceived as a hawkish choice, leading to a stronger dollar and reduced appeal for dollar-denominated commodities [1][3][14]. Group 1: Market Reaction - Gold prices fell sharply after reaching a historical high, with a drop of nearly 13%, marking the largest intraday decline since the early 1980s [1][11]. - Silver, which had previously surged past $120, saw its price plummet over 35%, the largest recorded drop in history [1][11]. - The entire metals market was affected, with copper also experiencing a significant decline of nearly 6% after reaching record highs [1][11]. Group 2: Federal Reserve Policy Expectations - The market's sell-off was driven by a sudden shift in expectations regarding Federal Reserve policy, with Warsh's nomination seen as a signal against aggressive rate cuts [3][4]. - Analysts noted that Warsh's hawkish reputation, despite recent support for rate cuts, contributed to a rebound in the dollar, making dollar-denominated commodities less attractive [4][18]. Group 3: Market Vulnerability - The dramatic price drop highlighted the extreme vulnerability of the precious metals market, which had been characterized by crowded long positions and record levels of bullish options buying [7][8]. - Analysts indicated that the market had become highly speculative, with a potential for a "gamma squeeze" that could exacerbate price movements [20][22]. Group 4: Technical Indicators and Market Sentiment - Prior to the crash, technical indicators suggested that gold and silver were overbought, with the Relative Strength Index (RSI) for gold reaching a historic high of 90 [24]. - Despite the sharp decline, both gold and silver recorded substantial gains for January, with gold up approximately 9% and silver over 10% [24]. Group 5: Mining Stocks and ETFs - The drop in precious metals prices led to significant declines in major mining companies, with stocks like Newmont and Barrick Mining falling over 10% [26]. - Silver ETFs experienced even greater losses, with some funds seeing declines of over 60%, marking their worst single-day performance [26]. Group 6: Future Outlook - Some analysts view the recent pullback as a healthy correction, suggesting that the rapid price increases necessitated a consolidation phase [26]. - There are indications that buying opportunities may arise as prices stabilize, particularly for silver, which is expected to benefit from industrial demand and supply shortages [26].

Core Insights - The year 2026 has begun with notable cross-asset volatility due to rising geopolitical risks, late-cycle monetary uncertainty, and uneven earnings visibility, leading to sharp sector and asset-class rotations rather than broad sell-offs [1] Precious Metals - Gold has traded above $5,300/oz and silver exceeded $110/oz in January, marking one of the strongest monthly starts in decades, with gold up approximately 23% in January, its best monthly performance since the 1980s [2] - In 2025, gold rose 65.2% and silver more than 150%, significantly outperforming global equities, while gold-mining equities gained 166.4%, compared to a 23.1% increase in the FTSE All-World Index [3] Earnings Outlook - Despite macroeconomic stress, the mean earnings-per-share (EPS) estimate for the Zacks S&P 500 Composite indicates a growth of 29.3% in 2026, with capital rotating towards assets with pricing power and strong balance sheets [8] AI Capital Expenditure - Companies are increasing long-term investments in AI data centers, advanced semiconductors, and cloud infrastructure, making this spending a strategic necessity rather than a discretionary upgrade [9][10] Sector Positioning for 2026 - Selective sector allocation is recommended for 2026, focusing on three standout sectors: AI infrastructure and semiconductors, precious metals and gold-linked equities, and energy and critical materials [11] AI Infrastructure & Semiconductors - Capital is concentrating in companies with AI capacity, with NVIDIA and Micron Technology emerging as key beneficiaries, projected to report earnings growth of 57.1% and 298.7% respectively in their upcoming fiscal years [12] Precious Metals & Gold-linked Equities - Gold-mining equities are outperforming bullion due to higher realized prices and disciplined capital expenditure, with Newmont and Barrick projected to report earnings growth of 20.8% and 45% respectively in 2026 [14] Energy & Critical Materials - The demand for electricity and key inputs like copper and nickel is accelerating due to AI data centers, with utilities like NextEra expected to report earnings growth of 7.8% in 2026 [16]

Group 1 - Newmont Corporation's stock experienced a significant drop of 7.2% after reaching an all-time high of over $134 per share [1][2] - The decline in Newmont's stock price is correlated with fluctuations in gold prices, which recently peaked at $5,615 before falling to $5,080, a decrease of 5.2% [2][3] - UBS raised its price target for Newmont stock by 28% to $160 per share while maintaining a buy rating, indicating confidence in the company's future performance [4] Group 2 - Despite a tripling in stock price over the past year, Newmont's stock is still considered undervalued with a price-to-earnings ratio of less than 20 and a projected earnings growth of 58% annually over the next five years [4][5] - The PEG ratio for Newmont stock stands at 0.34, suggesting it is a cheap investment opportunity [5] - Newmont was not included in the Motley Fool Stock Advisor's list of the 10 best stocks to buy, which may indicate alternative investment opportunities [6]

Group 1 - Precious metal stocks experienced a significant pre-market decline, with First Majestic Silver (AG.US) dropping nearly 13% [1] - Endeavour Silver (EXK.US) fell over 12%, while Pan American Silver (PAAS.US) and Harmony Gold (HMY.US) both declined nearly 10% [1] - Newmont Corporation (NEM.US) saw a decline of nearly 8% [1] Group 2 - Spot gold prices plummeted, breaking below the $5000.00 per ounce mark, with a daily drop of 7% [1] - The latest COMEX gold futures reported at $5027.80 per ounce, reflecting a daily decrease of 6.11% [1] - London spot silver fell over 16%, currently priced at $98.60 [1]

Company Performance - Newmont Corporation's stock closed at $126.93, reflecting a -3.8% change from the previous day's closing price, which is less than the S&P 500's daily loss of 0.13% [1] - Over the past month, Newmont's shares have gained 32.15%, significantly outperforming the Basic Materials sector's gain of 12.37% and the S&P 500's gain of 0.78% [1] Upcoming Earnings - The upcoming earnings report for Newmont Corporation is scheduled for February 19, 2026, with an expected EPS of $1.81, indicating a 29.29% increase compared to the same quarter last year [2] - The consensus estimate for revenue is projected at $5.75 billion, which represents a 1.78% increase from the prior-year quarter [2] Full Year Estimates - For the full year, Zacks Consensus Estimates project earnings of $6.33 per share and revenue of $21.72 billion, showing changes of +81.9% and 0%, respectively, from the previous year [3] - Recent changes to analyst estimates for Newmont indicate a favorable outlook on the company's business health and profitability [3] Analyst Ratings - The Zacks Rank system, which ranges from 1 (Strong Buy) to 5 (Strong Sell), currently rates Newmont Corporation as 3 (Hold) [5] - The Zacks Consensus EPS estimate has increased by 3.27% in the past month, reflecting positive sentiment among analysts [5] Valuation Metrics - Newmont Corporation has a Forward P/E ratio of 17.25, which is a premium compared to the industry average Forward P/E of 16.02 [6] - The company has a PEG ratio of 1.01, while the Mining - Gold industry has an average PEG ratio of 0.49 [6] Industry Overview - The Mining - Gold industry, part of the Basic Materials sector, holds a Zacks Industry Rank of 74, placing it in the top 31% of over 250 industries [7] - Research indicates that the top 50% rated industries outperform the bottom half by a factor of 2 to 1 [7]

Group 1 - Precious metals, particularly silver and gold, have reached all-time highs in early 2026, indicating a strong market sentiment among "gold bugs" [1] - The S&P 500 Materials Sector SPDR (XLB) is not reflecting the same bullish sentiment, suggesting a divergence between precious metals and industrial materials [2][4] - XLB includes major companies in the industrial sector, such as Linde PLC, Newmont Corp, and Freeport-McMoRan, but is struggling to keep pace with the S&P 500 Index despite higher metal prices [4] Group 2 - The current market situation indicates a cooling industrial demand for materials, as chemical companies and construction material providers face margin pressures from rising energy costs and slowing manufacturing data [5] - Historically, a scenario where precious metals rise while industrial materials lag signals a speculative rally rather than one based on economic fundamentals [6] - XLB is currently near its 200-day moving average and unable to break resistance levels, suggesting potential exhaustion in the rally of gold and silver [7] Group 3 - The high Percentage Price Oscillator (PPO) level and stretched price nature of XLB indicate caution for investors, although a rally in energy stocks could mitigate some of the potential downturn in precious metals [8]