MW Gold and the S&P 500 are hitting highs in rare lockstep, reflecting a shifting view of 'haven' assets
By Joy Wiltermuth
Gold and U.S. stocks - not the dollar nor Treasurys - are the go-to safety plays in 2026
President Donald Trump speaks to the media Tuesday outside the White House.
Canadian Prime Minister Mark Carney seized the world's attention at Davos last week when he laid out a "rupture" of the world order, adding: "We know the old order is not coming back."
It could be argued that some investors reached a similar conclusion well before January, based on the historic rise in gold prices (GC00) to above $5,000 an ounce, from roughly $2,000 in late 2023.
"Gold - for my entire career - it's been the safe haven of safe havens," said Mark Hackett, chief market strategist at Nationwide Investment Management Group. "That's the trigger for why gold's done so well."
The gold rush to fresh highs also can be attributed to the weakness of alternative "flight-to-safety" trades, including the dollar DXY and longer-duration Treasurys BX:TMUBMUSD10Y since President Donald Trump's return to the White House.
Gold has gained more than 85% since Trump's return to office, while the S&P 500 index SPX has advanced about 15% and the U.S. Dollar Index DXY has retreated by more than 12% when measured against a basket of rival currencies, according to FactSet.
Read: Dollar tumbles to a four-year low as Trump claims it's 'doing great'
Furthermore, anyone who was hoping for 10-year Treasury yields BX:TMUBMUSD10Y to ease as the Federal Reserve starting cutting rates back in September 2024 would be disappointed. Instead of falling, the benchmark rate was at 4.25% on Wednesday, up from about 4.15% two years ago, keeping borrowing costs elevated for households and the U.S. government.
"When people are looking for havens, you don't think of the stock market as a haven," said Stephen Dover, chief market strategist at the Franklin Templeton Institute.
Yet that's how U.S. stocks have been treated by investors lately, especially in the wake of the the monster rally in equities since last April's tariff scare.
So long as earnings growth continues and investors keep buying the dip, gold and stocks may continue to be treated as "go-to" safety plays, Dover said. "That's an unusual place for the equity market."
Gold, stocks are having a moment
Gold and the S&P 500 generally don't move in the same direction, even if they have done so in certain periods over the past 45 years. The below chart shows their closer correlation in the mid-1980s when inflation was a problem, during the early 2000 dot-com bubble and again in 2025.
Moves in the S&P 500 and gold usually aren't as closely correlated as they have been lately, according to Nationwide.
"When you think about the laundry list of things we have to worry about," said Hackett at Nationwide, "all these things would drive a flight to safety" in the past. "Now we are seeing record highs in gold and near-record highs for the stock market."
U.S. stocks, gold and silver all have been carving out new highs in January as investors fret about the Federal Reserve's independence; international tensions around trade and tariffs; potential U.S. intervention in Greenland, Venezuela and Iran; and as Trump looks to ease domestic unease after two citizens were shot and killed by federal officers in less than a month in Minnesota.
The S&P 500 was looking for a fresh record Wednesday after ending at 6,978.60, while the Dow Jones Industrial Average DJIA was flat, roughly 1.2% away from its previous record close, and the Nasdaq Composite Index COMP was pointing higher after finishing only 0.6% below its last record finish, according to Dow Jones Market Data.
The push into stocks has been helped by workers "throwing money into the 401(k)s" each paycheck, often providing a new source of funds to put to work in the stock market, Hackett said. It also has helped that any pullbacks since 2020 have prompted retail investors to buy the dip.
"It has worked," said Robert Bernstone, head of trading at SummitTX Capital, of the dip-buying pattern. Similar reactions have been playing out in gold, as well.
Check out: Investors aren't scared of record gold and silver prices. Wall Street's price targets are struggling to keep up.
"As we look at the unraveling of the global order since WWII and the great deal of uncertainty that comes with that, it makes sense that gold would be a hedge for that," Franklin Templeton's Dover said.
Yet when it comes to tariff threats, the "velocity of moves" in markets have been diminishing, Bernstone said, noting that recent selloffs have been smaller and brief, since many people now assume that any initial tariff levels that Trump suggests will be dialed back, or never implemented.
Still, there's always a danger when people try to time the market, including any recovery. Someone might buy the dip because stocks seem to always come back quickly, Bernstone said, but it also matters when they need their money back, he added.
-Joy Wiltermuth
This content was created by MarketWatch, which is operated by Dow Jones & Co. MarketWatch is published independently from Dow Jones Newswires and The Wall Street Journal.
(END) Dow Jones Newswires
January 28, 2026 09:22 ET (14:22 GMT)
Copyright (c) 2026 Dow Jones & Company, Inc.
Comments