By Mike Murphy
The price of gold has surged about 34% so far this year.
U.S. stock futures edged higher Monday while gold futures hit a new all-time high, amid uncertainty around the Fed’s independence and the Trump administration’s tariffs, as well as rising optimism about potential interest-rate cuts.
Continuous gold futures (GC00) on the New York Mercantile Exchange rose about 1% to a high of $3,552.40 an ounce on Monday. Gold was most recently trading around $3,550. The precious metal has seen its price soar about 34% year to date.
Dow Jones Industrial Average futures (YM00) rose 29 points, or 0.1%. S&P 500 futures (ES00) and Nasdaq-100 futures (NQ00) also gained about 0.1%. Bitcoin (BTCUSD) sank below the $108,000 level, while crude oil, as reflected by West Texas Intermediate front-month prices (CL.1), gained nearly 1%.
Gold is seen as a safe-haven asset, and its appeal has gained amid fears that the U.S. Federal Reserve may lose its independence. President Donald Trump has, for months, pressured Fed Chair Jerome Powell to slash interest rates, and his recent attempt to fire Fed governor Lisa Cook is seen by many as an attempt to impose control over the central bank.
The legality of Trump’s firing of Cook is still in dispute; a judge made no immediate ruling after a Friday hearing, and the case could eventually make its way to the U.S. Supreme Court.
The legality of Trump’s global tariffs is also in doubt. A federal appeals court on Friday upheld a lower court’s ruling that they were illegal, but the tariffs will remain in place at least until Oct. 14 to allow the Supreme Court to review the case.
Meanwhile, Wall Street is optimistic that the Fed will cut rates at its next meeting later this month. Lower borrowing costs can make gold a more appealing investment as opposed to interest-bearing investments, such as government bonds.
September is expected to be a critical month for the markets.
“The real question isn’t whether the rally can carry on but how the market will handle stress if the veneer of calm is ripped away,” Stephen Innes, managing partner at SPI Asset Management, said in a note Monday, suggesting a 5% to 10% pullback is “entirely plausible” before a recovery by year’s end.
On Friday, stocks closed lower but still finished August with gains. The Dow Jones Industrial Average DJIA slipped 0.2% on Friday, while the S&P 500 SPX fell 0.6% and the Nasdaq Composite COMP dropped 1.1%. For the month of August, the Dow rallied 3.2%, the S&P 500 climbed 1.9% and the Nasdaq gained 1.6%, with each index hitting record highs.
Investors will be keeping a keen eye on jobs data later this week: July numbers on job openings on Wednesday, ADP employment data and initial jobless claims on Thursday and the government’s monthly jobless report on Friday.
Read more: Why investors should brace for ‘extreme sensitivity’ in the stock market around this week’s jobs data
Powell has suggested the Fed may cut rates if employment data is too weak, and investors will be hoping the reports hit a sweet spot – showing modest payroll growth, but a slight rise in unemployment that would be enough to trigger a rate cut without raising fears of a recession.
-Mike Murphy
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09-01-25 1821ET
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