Gold Vs Sensex Vs Dow Jones: Who Gives Better Returns? Nvidia, NTPC, HDFC Bank, Reliance, Tesla Top Picks

Gold prices in India outperformed Sensex and Dow Jones despite being volatile in May month. YTD, gold rates in India zoomed by more than 25% in 24 carats and 22 carats respectively, while Sensex climbed over 3.1%. However, this is not the case with Dow Jones. Expert suggests balancing out the portfolio amidst expensive gold and stable gains in stocks.

Gold Rates In India:

On May 22nd, 24-carat gold is at Rs 97,910 per 10 grams, while 22-carat gold price is at Rs 89,750 per 10 grams. In May so far, gold prices are up by 2.3% each across carats.

From January 1st to May 22nd, gold rates are up by 25.5% across carats. On January 1st, 24-carat and 22-carat gold prices are at Rs 78,000 and Rs 71,500 per 10 grams.

Sensex, Dow Jones:

Sensex plunged by 0.8% or 644.64 points to end at 80,951.99 on May 22nd. Year-to-date, Sensex advanced by 2,444.58 points or 3.11%.

Meanwhile, Dow Jones edged higher by 42.50 points or 0.10% to perform at 41,902.94. However, so far in 2025, DJIA has dropped by 489.33 points or 1.2%.

"The last few months were a rollercoaster for traders. Gold made its all-time high, then dropped sharply, Meanwhile, stock markets, regardless of worldwide uncertainties, have brought solid returns," Ankur Sharma, Market Analyst, at VT Markets wrote in a note.

According to the analyst's note, gold has always been termed as a safe haven asset whether there are uncertainties of war, economic issues or when US interest rates fall buyers pick gold over Bonds and yields and vice-versa with the dollar.

However, gold is unpredictable. Key factors for this are:

- Global interest rates: When US interest rates rise, gold prices often fall because investors prefer bonds over non-interest-paying gold.

- Dollar strength: A strong dollar makes gold expensive for foreign buyers, lowering demand.

- Central Bank buying: Countries like India and China have been buying gold, which supports prices.

India is the world's second-largest consumer of Gold and High gold prices can hurt household budgets, especially for weddings and festivals. But for the Investors they can use gold as a hedge against their stocks or bonds, said the expert.

But, investing in stocks is a wise option but you should know how the market is reacting despite inflation, war fears and economic breakouts. The S&P 500 and Nifty have given good returns in recent years. Adding he said, "Big tech stocks in the US are pushing the Nasdaq up, and investor sentiment is fairly positive, at least for now. Easing inflation in major economies, hopes of interest rate cuts by the US Fed later this year and strong corporate earnings and undoubtedly India's growth story getting global attention which can increase more FII's and equity investments."

So what should investors do? Balance both!

"If you're nervous about markets, keep around 10-15% of your portfolio in gold - maybe through gold ETFs or digital gold. It acts like an insurance. For the rest, stay invested in quality stocks. Focus on sectors that are expected to benefit from the Indian growth story," said Sharma.

Stock picks for long-term growth, as per Sharma are;

- L&T (Larsen & Toubro) - Infra play, benefiting from government spending

- HDFC Bank - Solid fundamentals, steady growth

- NTPC - Clean energy transition and strong dividend yield

- Apollo Hospitals - Healthcare demand on the rise

- Reliance Industries - Diversified, with exposure to retail, energy & Digital

- Tata Motors - EV push and strong global presence

Stock Picks On Wall Street:

- NVIDIA (US) - Leader in AI and chips.

- Tesla (US) - EV demand is rising globally.

- TSMC (Taiwan) - Makes chips for Apple, NVIDIA, and others.

In short, India has become an attractive destination for both foreign and local investors - and that's good news for the stock market. Lastly, the expert said, "The bottom line is You should have a diversified portfolio where there are equities, bonds, and commodities like gold in order to absorb any uncertainties in the market and secure your investments."

Disclaimer: The recommendations made above are by market analysts and are not advised by either the author nor Greynium Information Technologies. The author, nor the brokerage firm nor Greynium would be liable for any losses caused as a result of decisions based on this write-up. Goodreturns.in advises users to consult with certified experts before making any investment decision.