Gold merger boom meets tariff reality check.

Transcript

Tom Gold miners merging into an eighteen billion dollar giant, but India just doubled its gold tariff — are we digging ourselves into a demand hole? It's Investment Flash, New York edition, May thirteenth.

Marie Bonjour everyone, I'm Marie. With me as always, the irrepressible Tom and the unflappable Gerald. Today we've got a gold merger boom, a tariffs tug-of-war, Jensen Huang in Beijing, and the ECB hiding in plain sight. Let's flash.

Marie So Equinox Gold is buying Orla Mining for over five billion dollars, creating an eighteen point five billion dollar North American gold major. Two big papers flag it, and the gold miners ETF is up four point three percent this week.

Tom Buddy, that's a consolidation wave. Scale and synergies — you love to see it. The gold miners ETF has momentum, and Equinox is still twenty-seven percent below its high. I'd be buying that.

Gerald Yeah look, Equinox's one-week drop of three point six percent suggests the market already sniffed out the premium. And India more than doubling gold tariffs overnight? That's a sledgehammer to demand. The world's second-biggest buyer just got priced out.

Marie And that's the real tension, Tom mon trésor. Two major papers confirm the tariff hike aims to defend the rupee, and it's bearish for precious metals. The gold ETF is barely down — just zero point three percent on the week — so maybe the street hasn't fully digested it.

Tom But gold's got a geopolitical bid from the Middle East. Safe-haven could buffer the fall. And if this merger fires up the sector, the gold miners might still rally.

Gerald Or gold could slide further. It's already sixteen percent off its high. The silver ETF is up nearly ten percent this week — that's a bull trap if demand craters. I'd be selling both.

Marie So for gold, the merger is a bright spot, but the tariff shadow is long. The two forces are pulling in opposite directions. Let's shift to China AI, where Nvidia's Jensen Huang is on his way to Beijing.

Tom No way — the president invited him personally. This could unlock chip access to China. Baidu and Alibaba surged on the news. Nvidia at an all-time high — forward price-to-earnings about twenty — but if restrictions ease, that's a new runway.

Gerald Honestly Tom, it's a photo op until we see policy. Nvidia at all-time highs pricing in a lot of hope. And a forward price-to-earnings of twenty isn't exactly cheap for a stock that's up over a hundred percent in a year. Analysts revising price targets after the fact is basically a free retirement plan.

Marie But the real split, Gerald chéri, is that the FT points out Tencent and Alibaba are missing the AI rally. BABA is down seven percent this week, near its low. It's a binary bet: if Huang's trip yields something, Alibaba could reverse sharply. Otherwise, it's dead money.

Tom Right, but Baidu is the pure AI play, and it's cheap at one point two three times book. I'd buy that, and Nvidia of course.

Gerald Tencent is down twenty-seven percent year to date, pinned to its low. The market wants pure AI, not diversified Chinese tech. The China internet ETF is down one percent this week — that's a malaise.

Marie And don't forget, regulatory crackdowns can return overnight. I'd be very selective. Now, CME Group is planning something truly novel — futures on AI computing power.

Tom This is the new oil, Marie. GPU rental as a commodity. CME Group stock up six percent year to date, and Nvidia benefits as the dominant supplier. I'm telling you, this legitimizes compute.

Gerald Alright, fair enough, but it's a tiny revenue stream for CME — forward price-to-earnings of twenty-two for modest upside. And Nvidia's already priced for AI domination.

Marie Mais bien sûr, but the FT calls this the most original take today. If this futures market takes off, it provides transparency and hedging. That could actually attract institutional money into chip stocks.

Tom Exactly! And it's a pure momentum play. Nvidia already at an all-time high, but the derivatives market could amplify interest.

Gerald Fine, watch CME if you must. But I'd wait for actual volume. Now, speaking of wild signals, the copper-to-gold ratio just broke above its two hundred day moving average for the first time since twenty-twenty.

Marie CoinDesk says this ratio historically leads bitcoin bull runs. The copper ETF is at a fifty-two week high, the gold ETF off its high — so the ratio is driven by copper strength.

Tom For real? The twenty-twenty signal! I'm getting bullish on bitcoin. Copper at six sixty-five a pound, gold near forty-seven hundred — that ratio breakout is a risk-on signal.

Gerald Tom, the correlation between this ratio and bitcoin is minus zero point eleven. That's like saying my umbrella predicts a sunny day. The rally is in copper, not crypto.

Marie But at the same time, CoinDesk reports tokenized Treasuries have hit fifteen billion dollars as bitcoin stalls. That yield competition is real, especially if the Federal Reserve raises rates.

Tom But wait — Charles Schwab just started rolling out spot crypto trading to thirty-four million retail accounts. That's a massive on-ramp. Bitcoin and ether could get a real boost.

Gerald It's early days. Charles Schwab stock is down nearly twelve percent year to date. Crypto revenue won't move the needle soon. To be fair, it does broaden access, which is a tailwind.

Marie So the bitcoin signals are mixed: a historical ratio flash, a yield competitor, and a retail distribution catalyst. The market is uneasy.

Tom Alright, let's talk streaming. Ad spending on platforms is projected to hit twenty billion dollars by twenty twenty-nine. Netflix, Disney, Roku — all benefit. Netflix has an ad tier now, forward price-to-earnings of twenty-two point five, and it's off thirty-five percent from its high. That looks interesting.

Gerald Netflix down five percent year to date, sure, but the growth story is maturing. Disney, on the other hand, is up fifteen percent from its low and cheap at one point seven times book. I'd prefer that safety.

Marie And Roku is the pure ad play, up eighteen percent year to date near its high. That's momentum, Tom darling. You'd love that.

Tom I do! But Gerald, only you could turn a streaming boom into a value pivot.

Gerald HSBC's Max Kettner says stocks can rally even with rising bond yields because of earnings recovery. And a separate piece argues five percent Treasury yields aren't sticky. That's two voices saying don't panic.

Marie The S&P 500 ETF is at an all-time high, so the market is already pricing that optimism. But if yields do retreat, the long-duration Treasury ETF could rally — it's near its fifty-two week low.

Tom So buy the long-duration Treasury ETF as a contrarian? Gerald, that's your kind of trade. But I'd rather ride equities.

Gerald Look mate, if five percent yields do stick, the HSBC thesis cracks. That's the risk we can't ignore.

Marie Let's touch Indonesia quickly. MSCI removed some stocks linked to billionaires from its indexes. The Indonesia ETF is down two percent today and twenty-four percent year to date — a broken chart.

Gerald Passive flows will flee. Another reason to avoid emerging markets unless there's a catalyst.

Tom Ouch, yeah, that's a sell.

Marie So our view ties it together. The gold merger wave is exciting, but India's tariff is a real demand side headwind. The gold ETF barely moved, so traders might be asleep at the wheel.

Tom And the AI trade: Jensen's trip lit a fire, but it's selective. Nvidia at all-time highs, Tencent at its low — you have to pick pure plays.

Gerald And if five percent yields prove sticky, the whole equity resilience thesis gets tested. Watch the long-duration Treasury ETF — it's pricing either recession or a Fed mistake, but not both.

Marie Écoute, what's missing from the press? The ECB. With European bonds quiet, the market has forgotten about Frankfurt. If the ECB signals tightening next week, the dollar could weaken, lifting gold and beaten-down emerging markets like Indonesia. That's a cross-asset catalyst nobody's positioned for.

Tom Voilà! So maybe the gold tariff drag gets offset by a weaker dollar. And the Indonesia ETF might bounce. Marie, you're making me think macro.

Marie Tom mon trésor, I always make you think. But no, really, the ECB is the shadow catalyst. The ECB warns about everything, including breakfast — but the market's ignoring it.

Gerald Alright, as always, none of this is investment advice. Just three friends talking.

Tom That's a wrap. See you tomorrow morning.

Marie Back on Monday if not sooner. À bientôt.