Markets started out 2018 with almost unbelievable heat, accelerating even after a record 2017. This morning, investors appear to be taking some profits, driving markets down broadly at the time of this writing. Momentum is sagging across the board, with decliners exceeding gainers almost 2:1.
While News Quantified did manage to find some profitable long plays on the day, today’s profit taking environment provides a great opportunity to take a look at our Top Short of the session.
This morning, US Gold Corporation, long one of the “gold standard” mining stocks for US investors, announced a new round of stock issues. These equities will be sold directly to investors, without the use of a broker or investment bank. USAU expects to net around $4.9 million from the $5.0 million
Investors cringed at the move, selling off the stock and driving it to losses just under 20% at the time of this writing (after recovering slightly from -30%). USAU expects to use the cash for working capital.
Stock issues, of course, are not inherently negative events. So why did investors head for the gates? In the current market environment, even with valuations relatively high, we’re seeing most companies engage in buybacks—using retained earnings to bet on the future of their own company. USAU’s decision to issue stock may suggest it views its own stock as adequately valued (or even over-valued).
The gold market—traditionally a safe haven for investors—has suffered over the past year as economic optimism became baked into equity valuations. Furthermore, cryptocurrencies seem to be taking the place of gold as an inflation hedge in some investors’ portfolios. With some commodity prices beginning to show signs of appreciation, however, there’s some genuine hope for a rally in gold this year.
In the coming year, we’ll be keeping an eye on the relative performance of stocks representing the “old gold” and the “new crypto.”
Diverse Plays, Great Profits: All in a single news day.
Keep checking our blog for daily updates on lucrative new-based stock plays, analyst actions, and more!
We analyze news events ranging from clinical trials in the pharmaceutical industry to routine earnings releases to major geopolitical shakeups.
Or, if you’re ready to move beyond the blog and experience the power of hedge-fund caliber news analysis in a package that’s accessible to small investors, click here to sign up for a free training today. You’ll see how easy to use our platform really is—and how many profitable trades it can unlock
A powerful news analytics platform like NewsQuantified not only makes it easy to track the
How are you using the news to earn market-beating profits? How would you use the news if you had access to a real-time platform like NewsQuantified? Let us know in the comments below.