Comments from VanEck Asia Pacific CEO and Managing Director, Arian Neiron:
Markets are riding high coming into 2025. International equities have had a strong run, with IT, communication services and consumer discretionary - all seen as beneficiaries of the incoming Trump administration - among the best-returning sectors for the quarter. The gold price has continued to defy expectations, and bitcoin broke the US$100,000 barrier. In Australian equities, the banks have driven share market returns, led by CBA’s staggering rally.
US markets are exceedingly buoyant. Equities are roaring, complacency has crept into bonds, and credit spreads aren’t reflecting current market risks. This exuberance is precisely why investors are wise to tread carefully. There is considerable uncertainty over the direction global markets will take following the imminent Trump presidency, and there are several other factors that could cause volatility, such as escalating US debt, heightened geopolitical risk and rising trade tensions.
Investors who are fully cognisant of prevailing market conditions will find ample opportunity in 2025. With the Fed well into its easing cycle and the market expecting the RBA to start easing in 2025, long-duration assets may be the place to be. Emerging markets are offering strong relative fundamentals and a greater risk premia. We think gold still has strong upside potential, and gold miners – which may be among the few equities not priced to perfection – could outperform the yellow metal through 2025.
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