Gold and gold mining stocks are significantly outperforming the broader market, with analysts attributing this surge to “classic stagflationary behavior” as the precious metal hovers near the $3,700 per ounce mark.
This market action, described by some as a paradigm shift, reflects growing investor concern over persistent inflation coupled with stalling economic growth.
Gold Miners Outperform All S&P 500 Sectors YTD
The dramatic outperformance is highlighted in a chart shared by Otavio Costa of Crescat Capital, which shows the VanEck Gold Miners ETF (NYSE:GDX) crushing every single sector of the S&P 500 year-to-date.
This performance, according to macro analyst Maxence Visseau, is a "textbook stagflation playbook." He added, "When inflation stays sticky but growth stalls, hard assets outperform financial assets. We’re seeing 1970s dynamics in real-time."
Echoing this sentiment, Alessandro of Macro Mornings noted that with "equities struggling with margin pressures, bonds weighed down by sticky inflation," gold stocks are "emerging as a relative winner," reminding investors of past cycles when gold became the "ultimate stagflation hedge."
See Also: These 4 Precious Metals Stocks Outshine As Gold Rallies
Gold And Gold-Linked Instruments Reach For The Moon
The numbers confirm the narrative. While physical gold ETFs like the SPDR Gold Trust are up approximately 37% year-to-date, gold mining ETFs have delivered even more explosive returns.
The VanEck Gold Miners ETF and the VanEck Junior Gold Miners ETF have skyrocketed by 93.83% and 96.50%, respectively, showcasing the leveraged gains miners can offer over the underlying commodity.
This powerful rotation into hard assets comes as gold itself has surged over 44% in the last year, recently touching a record high of $3,674.75 per ounce.
| Gold ETFs | YTD Performance | One Year Performance |
| Franklin Responsibly Sourced Gold ETF (NYSE:FGDL) | 37.28% | 45.30% |
| Goldman Sachs Physical Gold ETF (BATS:AAAU) | 36.74% | 44.61% |
| GraniteShares Gold Trust (NYSE:BAR) | 36.89% | 44.72% |
| VanEck Merk Gold ETF (NYSE:OUNZ) | 36.62% | 44.50% |
| SPDR Gold Trust (NYSE:GLD) | 36.61% | 44.35% |
| iShares Gold Trust (NYSE:IAU) | 36.76% | 44.57% |
| SPDR Gold MiniShares Trust (NYSE:GLDM) | 36.88% | 44.82% |
| abrdn Physical Gold Shares ETF (NYSE:SGOL) | 36.79% | 44.65% |
| iShares Gold Trust Micro (NYSE:IAUM) | 36.95% | 44.87% |
| Invesco DB Precious Metals Fund (NYSE:DBP) | 35.21% | 37.38% |
| Gold Miner ETFs | YTD Performance | One Year Performance |
| VanEck Gold Miners ETF (NYSE:GDX) | 93.83% | 83.20% |
| VanEck Junior Gold Miners ETF (NYSE:GDXJ) | 96.50% | 97.38% |
CPI Data To Determine If Gold Rally Will Sustain
Looking ahead, market participants are closely watching macroeconomic data for further direction. According to Darshan Desai, CEO of Aspect Bullion & Refinery, the recent price strength is linked to inflation signals and monetary policy expectations.
"Gold prices have surged back toward record highs following an unexpected drop in U.S. wholesale inflation, reinforcing expectations of a Federal Reserve rate cut next week," Desai stated.
He noted that upcoming Consumer Price Index (CPI) data will be a critical catalyst, while underlying support for bullion remains strong due to "ongoing geopolitical tensions, sustained ETF inflows, and continued central bank buying."
Price Action
Gold Spot US Dollar fell 0.24% to hover around $3,631.96 per ounce, as of the publication of this article.
The SPDR S&P 500 ETF Trust (NYSE:SPY) and Invesco QQQ Trust ETF (NASDAQ:QQQ), which track the S&P 500 and Nasdaq 100 indices, respectively, ended higher on Wednesday. The SPY was up 0.29% at $652.21, and the QQQ advanced 0.033% to $580.70, according to Benzinga Pro data.
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Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.
Photo courtesy: Shutterstock
