« BeEarly.com adds BillCara.com to the bloglist, Thurs., Apr. 6, 2006, 7:18 AM | Main | Home-owners on the run, Thurs., Apr. 6, 2006, 12:34 PM »

April 6, 2006

Priced in gold, equity indexes are declining, Thurs., Apr. 6, 2006, 10:06 AM

Most traders are unaware that as equity indexes (priced in local currencies) are on the rise, they are, when priced in spot Gold, also declining. So, while the international broad market indexes are on the rise today, think of them as actually falling.

Over the past year, only the Nikkei 225 index (priced in JPY) is beating the performance of Gold (priced in USD).

But from the beginning of November-05, all these major indexes have fallen behind the spot (cash) Gold price.

007a021.gif

This chart shows the Nikkei 225 index (in Yen) shown in light green; the Euronext100 (in Euro) in a turquoise; the U.K. FTSE 100 (GBP) in red, the Nasdaq Composite (USD) in dark green; and the Dow 30 (USD) in dark blue.

Relative to Gold (in USD), the Nasdaq and Dow are trading down around the $490 level; the Footsie is about USD$510; the Euronext 100 is about US$535; and Japan's Nikkei Dow is at about US$570.

So you can smile at your rising portfolios, but I'm quite happy to be long Gold (actually goldminer shares, which are comparatively much stronger than spot Gold).

p.s., I happen to be "totally color-blind", so I apologize for guessing at the colors. :-)

Posted by Posted by Bill Cara on April 6, 2006 10:06:53 AM | Category: Bullion , Cara Today in the Market

Discourse

Bill,

Looks like the turn in SNDK came a little early bouncing 10% in two days...you expecting a pull back still prior to earnings?

p.s. Thanks for the link to beearly.com, always nice to gain more resources...

Brian

Posted by: Brian Egan [TypeKey Profile Page] at April 6, 2006 11:34 AM [link]

Bill,

Nice post , see related post at my blog.

Posted by: real1 [TypeKey Profile Page] at April 6, 2006 11:35 AM [link]

Hmmm, the idea sounds vaguely familiar.... :)

Posted by: MarkM [TypeKey Profile Page] at April 6, 2006 11:41 AM [link]

Wow. Every sector ETF that I track is negative on the day. I guess the market doesn't like prospects of the 30-year above 5%.

-Ben Green

Posted by: Soulek1 [TypeKey Profile Page] at April 6, 2006 12:26 PM [link]

Ben:
Add FXI to your list it is +.25@1:15PM and has had a nice run all week.

Posted by: C.Note [TypeKey Profile Page] at April 6, 2006 1:15 PM [link]

Sorry I mean Soulek1.

Posted by: C.Note [TypeKey Profile Page] at April 6, 2006 1:16 PM [link]