Gold Miners ETF GDX Plunges 7% on Inflation Fears

The conflict in Iran has escalated oil and gas prices, fueling concerns about persistent inflation and diminishing the probability of near-term interest rate cuts, with potential for rate hikes. This environment makes zero-yield assets like gold less appealing, despite its traditional role as an inflation hedge, as higher yields elsewhere offer more attractive returns.

Major holdings within GDX, including Agnico Eagle Mines (AEM), Newmont Mining (NEM), and Wheaton Precious Metals (WPM), experienced significant declines of 7.04%, 8.86%, and 7% respectively. DHF Capital's Bas Kooijman confirmed that elevated geopolitical tensions and rising energy costs are temporarily weighing on gold.

The SPDR Gold MiniShares Trust (GLDM) is highlighted as a top-performing gold ETF over the past 12 months.