Share article:
October 20, 2025
Our Portfolio Manager, Sam LaBell, joined BNN Bloomberg as the markets continue to climb on hopes that the U.S. government shutdown will end soon.
“The market is caught between fear and fear of missing out,” Sam said. You can see the fear based on how gold has climbed to US$4,300, up from US$2,600 at the beginning of the year. “It’s an unusually rapid increase in the level of gold and it doesn’t speak to a confidence in financial systems and markets when gold is rising this much.”
On the other hand, the U.S. equity market is trading at a record price-to-sales ratio of 3.3, while the price-to-earnings ratio is a little more reasonable at 22.5 times forward earnings on 13% earnings growth.
“Investors are very worried they’re not going to capture the gains if the market does continue to compound that earnings growth. But at the same time, the market is very concerned about the fiscal and monetary background, as evidenced by gold going up so much.”
The gold rally starts to become a little worrying because it has been so rapid and the rally seems to be driven by inflows into gold ETFs, which can easily reverse. That said, the valuations for gold miners have not caught up to the gold price and the profits they will be producing.
Sam recommends investors de-risk their portfolios and trim their exposure to gold if it has become overweight. Names he favours now include Brookfield Infrastructure Partners L.P. (NYSE: BIP), Enbridge Inc. (NYSE, TSX: ENB), TC Energy Corp. (NYSE, TSX: TRP) and GE HealthCare Technologies Inc. (Nasdaq: GEHC).
Watch the replay: Market caught between fear & FOMO: LaBell