You're listening to Taking Stock with pim Box and Kathleen Hayes on Bloomberg Radio. Gold the mirror image of the stock market for the last two trading sessions, rising for a second day today, adding to the biggest search in seven years on Friday. Uh The fallout from UK's decision to leave the EU is boosting the demand for gold as a safe haven after many factors have been boosting it so far this year. Will it continue? What does it mean for some of the gold companies like Barrick
and Newmont Mining. Well, let's put that question now to Maria Smirnova. She's portfolio manager at Sprout Asset Management. Welcome back, Maria, Hi, Kathleen, great to be here. Well Gold, how long will this Brexit impact last? Is this you know, everyone's kind of trading fast and furious. Maybe you had a position you had to cover one way or the other, so you're buying or selling gold or whatever it is. Or is this this is really going to cement this trend higher
in gold for a while. Well, certainly the Brexit decision on Friday or on Thursday was a surprise to the market in general, but we've believed in gold you know, for a long time now, we've become increasingly bullish from the end of last year at the beginning of this year, and we actually believe that the fundamentals that have been driving gold and silver higher this year UM have been there and are there and will continue. So we don't think that the Brexit vote is you know, at one
time event. We do think there's lots of upside left and gold going forward. Why uh, The fundamental reasons that we think, you know, are driving the drivers are slowing global economies and central banks around the world trying to stimulate their economies and as a result of that, UM yield dropping all around the world. You know, we talk about US yield the tenure being at one right now, that's down from previous years. We are looking at the
Fed not raising rates as much as we thought. Even last year, we thought we'd have four rate hikes this year and you know, we're not having that. In fact, I believe the probability of right hike now being factored into the market is zero close to December, so a lot has changed from last year, and the outlook for the global economy is quite different today than it was, you know, even six months ago, and those things are
the fundamental drivers for gold right now. So how do you characterize the fundamental view of the global economy now compared with six months ago? What is your view? And I think what you're referring to broadly isn't just your view, but how you perceive the view of all the investors around the world who are helping to fuel this gold rally right exactly. Um, we think that the the perception is, you know, has deteriorated in terms of the growth prospects
of the world. We talked about China, we talked about the US is the bright pot in the world. Right. The economy is growing at two to three percent, let's say, but it's it's I would say, it's considered tepid growth, right, it's not robust growth. And like I said, the FED has been signaling um fewer rate hikes this year UM and and that's had a tremendous impact on the markets
and how the markets view gold. So when you look at Barrack, when you look at Newmont, I mean Goldman Sachs says that Barrick Gold is now a conviction by they see gold averaging even higher than they thought before. Does this make sense to you. Do you agree, Well, I think we think that gold stocks in general are a buy, and of course gold stocks offer leverage to
the gold price. So we're you know where, we have a whole um gold portfolio management team, and we're fully invested in a whole variety of names, from the seniors such as Barrack to the juniors. Were continuously adding in changing our portfolios. We've actually been adding more junior names for that leverage in the portfolio. Junior names like who well uh um. When we talk about junior names, these
are generally exploration and development stories. So I'm probably not at liberty to discuss individual names, but um all, I will say these are smaller companies, you know, there may be just entering production versus Barrick of course, as a mature company with multiple minds all all around the world, and we have, you know, a whole basket of these names that we are very positive right now on most
gold names. I would say, so right now, spot gold uh today trading around one thousand, three hundred twenty six dollars and change the futures price just a little bit higher than that. You say that thirteen sixty is the resistance level after that four hundred. Duke's back that thirteen sixty level to be challenged anytime soon. If the market breaks that level and rises higher. Is this another bi
signal for gold? Absolutely, It's pretty difficult to call timing, I would say, but definitely if we go through thirteen thirteen sixty and then after four hundred, there's very little resistance because don't forget, we've come a long way down in the bear markets, so now we're pretty much retracing um that bear market, but on the way up. So we don't see a lot of resistance at the hundred level, and we'll get pretty bullish if we go through that level.
And uh, what is the next? Just really quickly about thirty seconds, what is the next? Like sort of is it? Is it breaks? It? Is it? What happens within the EU? As an Italian banking crisis bank in Japan? What's the key event you're watching next for gold? Um? I don't know if I have a key event. We're certainly watching what the Fed is saying and doing very closely. We think that Brexit and that the outcome of the vote will take a while to be digested by the markets
all around the world. We're watching volatilities around the world. We're watching currencies, We're watching a lot of factors um correlations between various factors UM. We're watching out for contagion. Basically, if there is contagious and it's spreads and we have a financial crisis, that could have affect our outlook. Okay, Maurice Mirnova, thank you so very much. Portfolio managers brought asset management joining us from Toronto. I'm Kathleen Hayes. This is taking stock on Bloomberg Radio.