Gold Outpaces S&P 500 as Uncertainty Fuels Flight to Safety
Gold has sharply outperformed equities in 2024 as investors continue seeking safety amid mounting economic and geopolitical uncertainty, according to analysis from The Kobeissi Letter, a prominent capital markets newsletter.
While gold had lagged the S&P 500 by nearly 10% since 2020, the tide has now turned. The newsletter notes that GLD, the SPDR Gold Trust ETF, is up 109% over the same period, compared to 74% for the S&P 500. Analysts attribute the shift not to weakness in equities, but to an overarching driver: uncertainty.
“Why are gold prices surging even as the market recovers? Uncertainty remains the answer,” the Kobeissi Letter wrote on X.
Historic Inflows Reflect Demand for Safe-Haven Assets
The recent surge in gold prices coincides with record-setting capital flows into gold funds. Three weeks ago, gold ETFs saw net inflows of $8 billion, the largest ever recorded, according to the Kobeissi Letter. The four-week moving average has now climbed to roughly $4 billion, another all-time high.
Analysts described the current cycle as “likely the strongest gold market of all time,” citing both investor sentiment and institutional demand.
Central Banks and Global Reserves Shift Toward Gold
The Kobeissi Letter also highlights aggressive central bank buying, which continues at historically elevated levels. Citing macro strategist Otavio Costa, the report says gold now makes up approximately 18% of global foreign exchange reserves, the highest proportion in 26 years.
At the same time, foreign ownership of U.S. Treasuries has dropped to just 23% of total U.S. government debt, marking the lowest share in over two decades. This shift points to waning confidence in traditional dollar-denominated assets.
Dollar Weakness Boosts Gold’s Appeal
Adding to the gold rally is the weakening U.S. Dollar Index (DXY), which recently touched a 52-week low. The index, which tracks the dollar against a basket of foreign currencies, has declined nearly 10% since the start of the trade war cycle.
A weaker dollar typically makes gold cheaper for foreign investors, further enhancing demand. Kobeissi analysts even suggest that gold is now acting as a “leading indicator for tariffs”, reflecting broader investor sentiment about macroeconomic risks.
Kosta has reported on cryptocurrency markets and blockchain infrastructure since 2020, bringing over six years of hands-on experience in the crypto industry built through daily tracking of markets, trends, and emerging blockchain developments. Specializing in Bitcoin on-chain analysis, institutional ETF flows, and digital asset price action, his work at Coindoo has been cited by other news agencies and consistently covers market developments with a focus on data-driven reporting across Bitcoin, Ethereum, Solana, and XRP. Over the years, Kosta has contributed to multiple crypto media outlets in different regions, authoring over 6,000 articles across the sector. His reporting spans cryptocurrency markets and the broader fintech industry, tracking not only price action but also the technological and regulatory forces shaping the ecosystem. To support his analysis, Kosta actively leverages on-chain data and metrics from leading platforms such as Santiment, Glassnode, and CryptoQuant, enabling deeper, evidence-based market insights. He believes in the power of transparency and the data that underpins the blockchain ecosystem. His academic background in Marketing Management from Denmark further complements his analytical approach, adding a strong understanding of communication strategy and content positioning to his work.
