The ASX is a bloodbath today. At time of writing, the ASX 200 has dropped by 155.5 points (or 2.34%) to 6494.4.
The only green shoots there are mostly coming from the gold miners (gold stocks).
There has been a lot of turbulence in the markets. As for the reason why this is happening, well…take your pick.
Overnight bad economic data came from the US. Private payrolls grew by 135,000 in September, lower than the 157,000 from the month before.
This comes after the Institute for Supply and Management (ISM) Index fell to its lowest level since June 2009, showing that US manufacturing activity is also slowing.
All this is increasing concerns that the trade war is starting to have an effect on the US economy. An economic slowdown could mean more interest rate cuts from the US Fed, and this could be good for gold.
Overnight, the World Trade Organisation (WTO) told the US they can go ahead and impose tariffs on some imported goods from the EU, as a way to compensate for EU subsidies to Airbus. Tariffs would affect goods like wine, whisky and aircraft parts.
Add impeachment talk against US President Donald Trump, tensions in Hong Kong and Brexit, to the growing list of things that is making investors nervous.
So investors could be looking at reducing risk by flocking into gold.
What could happen next with Gold?
Gold is getting a push from increasing tensions and concerns over a global economic slowdown.
But also from central bankers buying gold. Central banks have been buying more gold to diversify their reserves, but also as global growth slows and trade war tensions increase.
According to the World Gold Council, central banks have bought 374.1 tonnes in the first six months of the year, and this higher demand has been pushing gold prices higher.
Author and gold expert Jim Rickards thinks gold prices could go even higher.
In an exclusive interview with Greg Canavan, editor of The Rum Rebellion, Jim explains why he expects gold prices could hit US$10,000 in the next years. You can hear about this and more here.