TSX higher with Bank of Canada, Fed meetings in focus
- Gold sits near record levels, and rate cuts add fresh fuel to the story.
- Central bank buying and global tension strengthen the case for metals and miners.
- This backdrop points to ten stocks that may surprise even seasoned investors.
- For a limited time, get an InvestingPro subscription at the lowest price of the year with our extended Cyber Monday discount.
Gold climbed for months and touched a record high of $4,398 per ounce on October 20. It then saw a quick drop to $3,890 on October 28.
The metal picked up again through November with a gain of 6.4%. The first days of December showed some hesitation, though the broader trend still moves upward.
The Fed meets tomorrow evening, and a rate cut looks very likely. The Investing.com rate barometer shows a probability above 80 percent that the FOMC will move in this direction, and many expect more easing through 2026.
This supports gold. A Fed rate cut usually weakens the US dollar. A softer greenback lifts gold prices because the metal is priced in US dollars.
A rate cut from the Fed also lowers the appeal of bonds and money market products, since their yield advantage over gold fades.
This view, combined with strong central bank buying and a geopolitical environment filled with tension, has pushed several major banks to predict fresh records for gold. Many expect the metal to move beyond $5,000 an ounce next year.
Goldman Sachs and Bank of America both project $5,000 by the end of 2026. JP Morgan places its forecast at $5,200.
Gold still appears attractive for investors even though the price sits close to its record level. A stronger upward trend in gold would also lift mining and metals stocks.
10 Mining stocks with strong upside potential
We began looking for opportunities in this sector with the Investing.com stock screener. We carried out a search based on the following criteria.
- US market
- Metals and Mining industry
- Market capitalization of over $200 million
- Upside potential of over 20% according to InvestingPro Fair Value
- InvestingPro health score above 2.5/5
In this search, we used InvestingPro metrics, including Fair Value and Health Score, which are available only to InvestingPro subscribers with a PRO+ plan. Fair Value provides an average of several recognized valuation models for each stock, while the Health Score evaluates multiple financial metrics to measure a company’s overall strength.
This search helped us find 10 opportunities.
- Are you an InvestingPro subscriber with a Pro+ plan? Click here to access this screener search
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These stocks trade at discounts of 20.9% to 50.7% based on InvestingPro Fair Value. Six of them also have a health score above 3, which is uncommon. A few names here are broader metals players rather than pure gold firms, for instance Century Aluminum, yet they still deserve close attention from investors.
For readers who feel unsure about the outlook for gold or for metals and mining shares, there are many other ways to hunt for strong ideas as the Fed moves toward a rate cut.
Small caps often stand out as prime beneficiaries during easing cycles. The Investing.com screener includes several ready-made searches focused on small caps, which can serve as a solid starting point for fresh opportunities.
Please note that some searches are reserved for InvestingPro subscribers with a PRO+ plan.
Please keep in mind that some of these pre-configured searches are available only to InvestingPro and Pro+ subscribers.
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Disclaimer: This article is written for informational purposes only. It is not intended to encourage the purchase of assets in any way, nor does it constitute a solicitation, offer, recommendation or suggestion to invest. I would like to remind you that all assets are evaluated from multiple perspectives and are highly risky, so any investment decision and the associated risk belongs to the investor. We also do not provide any investment advisory services.