COMMODITIES

Over the last few years of near zero interest rates, money was aggressively pushed into growth and consumer stocks (especially big tech) that benefit from an economy awash with easy money - pushing up those share prices to record highs.

Tech has had a huge run over the last decade but we think now is the decade for commodities to shine.

It looks like the commodities supercycle we have been predicting is now underway. We’ve been saying it's coming for a long time but are now seeing firm evidence that it's here across further recent commodity price spikes and mainstream media reports.

The pain in the markets continued this week, with many of our small and micro-cap stocks bearing the brunt of it. We can sense the fear in the market, but as long-term investors we remain firmly committed to our portfolio companies. As a result, what follows today is a look at how we see things playing out in the market now and into the future.

The Next Investors weekly wrap up, covering off everything that happened in our portfolio this week.

Thomson Resources (ASX: TMZ) original tin asset is looking very interesting for a potential sale, spinout or some drilling

The ASX had a particularly strong run last week, but the winning streak appears to have come to an end with equities markets falling significantly across Europe and the US.

The ASX 200 ended up 1.1% for its fourth straight daily gain yesterday. The index is now up 5.4% for the week, and with ASX SPI200 futures now up 12 points we could be in for another green day. A fifth straight day in the green would mark the index’s best week since April.

With generally negative leads from overseas, the ASX SPI200 futures index looks to be on the mark, down 17 points. It appeared that consternation surrounding the budget last evening resulted in many traders sitting on the sidelines to watch the day play out and the budget to beat all budgets unfold.

A strong lead from the US overnight could see a rebound today, and the ASX SPI200 futures index is pointing in that direction, up 11 points to 5813 points.

Following leads from Europe and the US, the ASX SPI200 index is up 38 points, suggesting we could see a significant bounce.

So is gold and silver a good investment right now and where are these commodities heading in in the last quarter of 2020 and into 2021?

Looking at the current state of the market, US stocks fell and Treasuries gained overnight as investors consider whether current levels of stimulus are enough for the country’s slow, but gradual economic recovery.

When the world moves into recovery mode from the COVID-19 recession, materials are likely to create the next boom, as nations focus on infrastructure to stimulate their economies.

The S&P/ASX 200 index (XJO) soared 110 points on Wednesday, helping to offset three consecutive days of losses leading up to that point. Given the strength in overseas markets last night, this trend is likely to continue and the ASX SPI200 index is up 42 points.

Mixed leads from overseas with European markets down and US markets rallying, which could see a fairly uncertain start to the week.

The ASX SPI200 futures index is down 15 points, suggesting that the Australian stock market will take its lead from the US. However it was not all bad news, especially if you invest in Apple, as it became the first publicly listed US company to surpass the US$2 trillion market capitalisation level.

Overseas markets were mixed overnight, as investors assessed the prospect of additional stimulus in the US and subdued economic data in light of the record-breaking rally.