Stock Markets Decline as Gold and Silver Prices Surge

Global stock indices experienced a downturn on December 17 as U.S. technology shares faced significant pressure. The MSCI’s global equities gauge fell, with investors reacting to a mix of economic data and geopolitical developments. In contrast, silver prices surged to an all-time high, while gold continued its upward trend, marking a potential seventh consecutive gain. This shift is largely attributed to renewed hopes for interest rate cuts by the Federal Reserve and increased demand for safe-haven assets following U.S. President Donald Trump‘s recent actions in Venezuela.

The price of oil also saw a notable increase as Trump announced a “blockade” on all sanctioned oil tankers entering and exiting Venezuela. This move aims to intensify economic pressure on the Maduro government, which heavily relies on oil exports for revenue. As a result, U.S. crude prices climbed by 1.76 percent to settle at $56.24 per barrel, while Brent crude rose by 1.68 percent to $59.91.

Financial markets are closely monitoring comments from Federal Reserve officials, particularly Christopher Waller, a Federal Reserve Governor who indicated there remains room for interest rate cuts. This commentary comes amid signs of weakness in the U.S. job market, further complicating the economic landscape. Waller’s remarks were made in the context of ongoing discussions regarding his potential candidacy for the Fed chair position in interviews with Trump.

On Wall Street, technology stocks were the primary contributors to the market decline, driven by fears surrounding a potential artificial intelligence bubble. Notably, shares of Oracle plummeted after a report revealed that its largest data-center partner, Blue Owl Capital, would not support a planned $10 billion investment for its next facility.

Investors also reacted to rising U.S. Treasury yields as they awaited the latest inflation data, set to be released on December 18. The yield on benchmark U.S. 10-year notes increased by 1 basis point to 4.159 percent, while the 30-year bond yield rose to 4.8313 percent. The 2-year note yield, often closely aligned with interest rate expectations, climbed to 3.502 percent.

Market analyst Tom di Galoma, managing director at Mischler Financial Group, commented, “The market really still lacks a data focus,” indicating a sense of uncertainty among traders regarding the reliability of current economic indicators following a recent federal government shutdown lasting 43 days.

In terms of broader market performance, at 11:57 a.m. Eastern Time, the Dow Jones Industrial Average had decreased by 119.19 points, or 0.25 percent, to 47,995.07. The S&P 500 fell 56.85 points, a drop of 0.83 percent, to 6,743.50, and the Nasdaq Composite declined by 302.66 points, or 1.31 percent, to 22,809.54.

In foreign exchange markets, the British pound weakened following an unexpected decline in UK inflation, which has led to speculation regarding a potential interest rate cut by the Bank of England. The pound fell by 0.25 percent to $1.3387. Conversely, the U.S. dollar strengthened, with the dollar index, which measures the greenback against a basket of currencies, rising by 0.14 percent to 98.35.

The Japanese yen also depreciated against the dollar, trading at 155.58 per dollar, a decline of 0.56 percent. Meanwhile, the euro remained relatively stable as the European Central Bank is expected to maintain current interest rates in its upcoming meeting.

In the precious metals market, silver prices surpassed $66 per ounce for the first time, reflecting heightened investor interest in safe assets amid ongoing geopolitical tensions. Spot silver was last reported at $66.35, gaining 4 percent, while gold prices increased by 0.65 percent to $4,331.59 per ounce. U.S. gold futures also rose by 0.66 percent to $4,332.70 per ounce.

As markets react to these developments, investors continue to navigate a complex landscape influenced by economic uncertainties and geopolitical events.