MARKET NEWS
Silver Hits $50 for First Time in Decades - REUTERS
Takeaways by Bloomberg AIHide
- Gold slipped back below $4,000 an ounce and silver retreated from its highest level since 1980 as US equities weakened and investors locked in profits.
- Technical indicators show gold’s been trading in overbought territory for the past month, likely leading to some profit-taking by investors following a scorching four-day run.
- Silver retreated after touching $51.24 an ounce earlier Thursday — the highest in more than four decades, with its surge lifting prices by more than 70% this year.
Gold slipped back below $4,000 an ounce and silver retreated from its highest level since 1980 as US equities weakened and investors locked in profits.
Bullion slipped after a torrid rally this week left prices vulnerable to pullbacks on concerns that the metal is trading at overheated levels. Technical indicators show gold’s been trading in overbought territory for the past month, likely leading to some profit-taking by investors following a scorching four-day run. Platinum and palladium also fell.
Gold’s selloff coincided with Thursday’s weakness in US equities. While gold is traditionally viewed as a hedge against riskier assets like stocks, it often falls during broad market selloffs as investors sell their holdings to cover losses in other markets.
Meanwhile, silver retreated after touching $51.24 an ounce earlier Thursday — the highest in more than four decades. Silver’s surge lifted prices by more than 70% this year, outperforming gold’s year-to-date performance
The rally among the two key precious metals is part of a growing search for haven assets sparked by fears of fiscal risks in the US, an overheating equities market and threats to the Federal Reserve’s independence.
Read More: Once Mocked, Gold’s True Believers Are Having Their Big Moment
Silver often moves in tandem with gold, sharing its strong negative correlation with the US dollar and Fed interest rates. But the metal is also notoriously volatile, and has a cult following among retail investors who view silver prices as being suppressed by large banks and institutions.
Spot gold fell 1.6% to 3,976.65 as of 4:32 p.m. in New York, while spot silver was 0.8% higher at $49.29 an ounce.
