What 2013 Could Bring for Gold, Apple, Bank of America, and More
By T3Live.com Dec 31, 2012 11:20 am
From T3's Scott Redler, some key predictions about next year's markets.
Gold bugs were disappointed this year despite continued dovish policy from the Federal Reserve and world central banks. With gridlock in Washington, Ben Bernanke and company have taken it upon themselves to try to stoke the sluggish economic with monetary policy measures. The results have been minimal, and the measure taken somewhat questionable, but we have not seen the wave of inflation that some have expected. The Fed initiated “QE4” in December—more than doubling the size of its monthly asset purchases—but gold (NYSEARCA:GLD) has sold off in response.
On a macro chart, 2012 appears to be just a consolidation year for gold. Many analysts fear the possibility of a currency war in 2013 in which central banks debase their own currencies in an effort to export their way out of recession. This type of inflationary activity would have gold bugs salivating, and likely lead to a dramatic price increase for the commodity.
After rallying up to around the $1800 level in the second half of 2012, gold lost a bit of momentum and is trading back within the middle of its range. However, if the commodity continues to hold above $1600, it will increase the likelihood, in my opinion, that it trades back up to the $1800 level. If gold can get momentum through $1800 I believe it can sere $2000+ this year.
I think we could see several foreign and emerging markets outperform in 2013. Japan’s Nikkei 225 (INDEXNIKKEI:NI225) was up 23% in 2012, and I think it could have a similar performance in 2013. Poland (NYSEARCA:PLND), which is a bit off the beaten path, trades at a discount to many of its peers and I think has some room to the upside.
China’s economy has shown impressive resilience with economic data of late. Back in the summer I made a bullish call on the iShares FTSE/Xinhua China 25 Index (NYSEARCA:FXI), and when famed technician Tom DeMark’s made his call for the Chinese markets to have a strong year, I agreed wholeheartedly.
From a stock picking perspective, I don’t like to make a ton of blind calls. I prefer to let the price action during the year do the talking, but there are a few stocks I like for 2013.
Yahoo (NASDAQ:YHOO) is headed back in the right direction, I believe, thanks to new CEO Marissa Mayer. The former Google executive, who was the first female engineer at the company and a major part of its success, has the intelligence and experience to help YHOO redefine itself. The stock has had an impressive 34% run since early September, but if you zoom out the stock is just breaking out of a four-year lower-level base. I believe YHOO can get back to the $23-25 range next year.
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Scott Redler is long BAC, YHOO. Short SPY.