He said gold continues to play an important role in portfolios and that past rallies have often surprised markets. “When in the past we’ve had gold rallies, they go much further than people anticipate,” he said. Yardeni added that while gold and equities often diverge in the short term, their long-term trends have been broadly similar.
Gold price surged to an all time high of $4,400 an ounce on December 22 led by expectations of further rate cuts by the US Federal Reserve, and continued safe haven demand amid a softer dollar. The precious metal has gained about 67% so far in 2025.
On US equities, Yardeni said the backdrop remains supportive. He expects the S&P 500 index to reach 7,700 by the end of 2026, implying around 10% upside from current levels. He noted that the index is on course for its third straight year of double-digit gains and said a fourth year of similar returns is possible.
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Yardeni believes the artificial intelligence (AI) trade is likely to become more volatile, as it pushes large technology companies to compete more directly with each other, leading to higher spending. This could benefit a wider set of technology stocks beyond the largest names.
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Yardeni expects 2025 to be a consolidation phase for Indian equities after several years of strong performance. He sees scope for improvement in 2026, with the possibility of new highs if trade talks with the US move forward. He said investment opportunities exist in both India and China, but added, “My preference is to invest in India simply because I like the legal and corporate system better than what I see in China.”
Yardeni also shared his view on global monetary policy. He does not expect Japan’s policy actions to create broader global stress, but flagged concerns around policy direction. “It’s not a good way to drive a car to have one foot on the brake and another foot on the accelerator,” he said, referring to tighter monetary policy alongside fiscal stimulus.
For the full interview, watch the accompanying video
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