Buying gold? Buying tech stocks?

Some respondents to the latest Bloomberg Markets Live Pulse survey said that investing in America's biggest tech stocks is not only betting on innovation, but may also hedge against inflation.

This enabled them to generate stable profits and achieve gains that convinced investors that they could continue to be a steady source of growth.

The US inflation rate has declined significantly from its high level in 2022, but it surpassed economists' expectations in the first three months of this year and remains stubbornly above the Federal Reserve's 2% target.

This has basically made the rise in prices the biggest concern for investors. Most survey respondents — 59% of the 393 — said that a return in inflation is the top tail risk facing financial markets now until the end of the year. The next inflation report will be released on Wednesday, probably around 3.4%.

For example, since inflation first surpassed 2% in March 2021, Nvidia's stock price has soared more than fivefold.

Even Apple, which has experienced ups and downs, outperformed the market during this period, rising more than 50%, while the S&P 500 index rose by about 30% over the same period.

However, similar to other growth stocks, technology companies are sensitive to changes in inflation and interest rates because their valuations are mainly dependent on future profits.

About a quarter of respondents said that the US recession is the top risk in 2024. The survey shows that in this situation, US debt rather than US stocks can provide better protection.

Despite the Federal Reserve's tightening of monetary policy, the economy was unexpectedly resilient, causing cash to flow into the US, high yields on local bonds, and continuous growth in corporate profits.

The inflow of capital has caused the dollar to rise again, and the dollar is regarded by the vast majority as the best currency to survive the turbulent period in the market.

Nearly three-quarters of respondents said the US dollar was the best safe haven currency, while the Swiss franc received about 23% of the votes, while the yen was about five times less.

Among respondents in the US and Canada, the US dollar received 86% of the votes, while in Europe, 43% of those participating in the survey chose the Swiss franc.

The widening spread between Japan and the US caused the yen to fall to its lowest level since 1990 earlier this year.

Gold prices have climbed nearly 15% so far this year, and the Central Bank of China is one of the biggest sources of demand. After the Russian-Ukrainian war broke out, as Russia's dollar assets were confiscated, and many countries tried to diversify beyond the dollar, gold naturally became the beneficiary.

In the MLIV Pulse survey, only 13% of respondents said that investors' search for geopolitical diversified assets benefited Bitcoin.