5 Gold ETFs Riding The Safe Haven Rally

The deadly coronavirus eruption continues to rattle the global markets with new cases being reported from the Philippines and India. Globally, confirmed cases have already been reported from the United Arab Emirates, Hong Kong, Australia, Malaysia, Thailand, France, Japan, Taiwan, Vietnam, Singapore, South Korea, Macao and Nepal with the epicenter being Wuhan in China. The death toll rose to 170 in the world’s second-largest economy. Moreover, the total number of confirmed cases shot up to around 7,711 globally.

Health experts are comparing the coronavirus outbreak with severe acute respiratory syndrome or SARS epidemic that spread during the years of 2002-2003, which wreaked havoc for 38 trading days. Moreover, total cases registered during the SARS epidemic in China are now surpassed by the coronavirus eruption. Notably, the SARS epidemic had infected 8,098 people globally causing around 774 official SARS-related deaths.

The rapidly-spreading coronavirus is sparking fears of global economic slowdown among investors. Moreover, it is believed that China will face immense difficulty in keeping its commitments under the phase one trade deal with the United States due to its dwindling domestic demand. As a result, investors are seeking refuge in safe-haven picks. Gold, which has proven to be beneficial in times of market turmoil has been rallying to a near six-year high (per a Bloomberg article). The bullion already gained more than 4% in 2020.

Per Stephen Innes, chief market strategist at AxiCorp Financial Services Pty, the coronavirus-driven “sell-off in equity markets will likely drive gold demand over the short term. The more rapid pace of contagion will represent another significant headwind to global growth, bullish for gold.”

The yellow metal's price was also supported by the Federal Reserve’s concerns over weaker US investments and exports and the central bank’s move to keep the interest rate steady.

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