Is stock market really crashing in April? What would cause it? Watch these signals - Michael Gayed

March 26, 2021

New York (Mar 26)  Michael Gayed, portfolio manager at Toroso Investments, spoke to Kitco News about warnings signals of a market correction.

"I do think that the conditions are are starting to worsen, favoring some potential accident in the stock market," Gayed said.

Gayed pointed out several important indicators for an inflection point in risk assets.

“The way it’s shaping out here is that utilities, which are documented…as a leading indicator, are strengthening against the market. Typically, utilities get ahead of major crashes, corrections, and bear markets. Why? Because they are the most bond-like sector of the stock market and they benefit from the decrease in the demand for money. The yield curve is still steepening but that looks like it might finally be starting to abate. One of the indicators [that I track] is lumber to gold,” he said.

Historically, when lumber outperforms gold, higher stock market volatility typically follows, Gayed noted.


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