Wall Street Lunch: Gold Glitters (undefined:XAUUSD:CUR)

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Gold sets a new intraday record as Wall Street adjusts its forecasts. (0:15) Roku gets a vote of confidence. (3:24) Wall Street bonuses jump 30% to nearly $245K. (3:45)

This is an abridged transcript of the podcast:

Our top story so far, Wall Street is waving the white flag when it comes to the latest gold rally.

Spot prices (XAUUSD:CUR) set a new record as physical stockpiling of the yellow metal (as a hedge against tariff uncertainty and the potential inflationary impact) continues. New York demand for bullion led to record outflows in London in January.

Wall Street banks have been forced to rethink their theses. Goldman Sachs boosted its 2025 gold target to $3,300 from $3,100 and BofA predicts $3,500 per once within the next two years with U.S. trade policy supporting prices in the near term.

BofA said its new target can be reached if investment demand for gold increases by 10%, which can come from a number of places, including continued buying by central banks and continuing appetite for gold ETFs among retail investors.

According to Reuters, Goldman said: “On the gold ETF side, our U.S. economists continue to expect two 25bp (basis points) Fed cuts in 2025 and one additional cut in H1 (first half of) 2026, which underpins our baseline for ETF inflows.”

Looking to charts, SA analyst Dean Popplewell says immediate support rests at $2,982 and $2,950 if the lows at $3,004 are breached.

On the upside, immediate resistance rests in the $3,025-$3,030 range before the $3,050 and $3,075 handles come into focus.

Looking to the economy, initial jobless claims slipped to 224,000 from 225,000 in the prior week (revised from 223,000), slightly trailing the 225,000 consensus. Continuing claims drifted lower to 1.856 million from 1.89 million prior, compared with the 1.9 million expected.

Pantheon Macro economist Samuel Tombs says: “Claims remained low last week, with powerful storms across large areas of the South and Midwest having no immediate impact. The recent deterioration in hiring and firing indicators, however, suggests that claims will climb over coming weeks.”

“Claims filed by former federal workers are not included in the advance initial claims count, unless they also used to hold a second job in the private sector. Unadjusted claims by former federal workers fell to 821 in the week ending March 15, from 1,066 in the previous week, but they remain above their near-zero normal levels,” he added.

Among active stocks, Jefferies downgraded AMD (AMD) to Hold from Buy, suggesting that the gap between the company and Nvidia (NVDA) is widening.

Analyst Blayne Curtis said: “Our proprietary benchmarking report suggests real-world throughput of NVDA’s H200 across a range of open-source models is substantially higher than AMD’s MI300x, despite MI300x’s higher advertised (Tera Floating-Point Operations Per Second) and memory bandwidth,” referencing Nvidia’s Hopper line of GPUs, which were released in 2023.

Meanwhile, Nvidia is said to be nearing a deal to acquire Lepton AI, an artificial intelligence startup that rents out servers powered by Nvidia’s AI chips. The Information says the chipmaker would pay several hundred million dollars.

This acquisition aligns with Nvidia’s broader strategy to expand into the cloud and enterprise software market, positioning it in direct competition with major cloud providers like Amazon and Google.

And BofA initiated coverage of Roku (ROKU) with a Buy rating and a $100 price target.

Analyst Brent Navon said: “We believe Roku provides an attractive combination of top-line growth, margin expansion and scaling free cash flow generation,” adding that the stock’s premium multiple is justified given its long runway for growth and its profitability trajectory.

In other news of note, the bonus pool for New York City’s securities employees hit a record $47.5 billion in 2024, up 34% Y/Y, marking its first major increase since COVID-19 pandemic highs, according to the annual estimate from the New York State Comptroller.

The increase reflects Wall Street’s strong performance in the past year, bolstering New York State’s fiscal position, but “increasing uncertainty in the economy amid significant federal policy changes may dampen the outlook for parts of the securities industry in 2025,” it said.

The average bonus paid to employees in New York City’s securities industry for 2024 jumped 31% to $244,700. Also, boding well for the city and state, securities employment last year hit its highest annual level in at least 30 years, with 201,500 employees, up from 198,400 in 2023. However, New York is losing share of industry jobs as Wall Street banks shift some functions to other, less expensive regions of the country.

And in the Wall Street Research Corner, Americans are expressing worries about feeling the bite from a surge in consumer prices and tariffs, and seeing their stock portfolios hit hard in a major selloff.

51% of respondents to the Q1 Allianz Life Study expect “another big market crash is on the horizon,” rising from 46% in Q4 2024. The online survey conducted in February also showed only 26% of respondents were “comfortable” with current market conditions and were ready to invest, a drop from 31% in the previous quarter.

75% said they are worried that new tariffs will punch up their cost-of-living expenses. Meanwhile, 71% foresee inflation worsening over the next 12 months, a jump from 60% in the Q4 survey.