Gold And Silver Bounce Back As Tech Stocks Stumble

Gold and silver are showing renewed strength after snapping a three-week losing streak. Early Monday trading put gold around $4,140 an ounce and silver above $53, extending last week’s recovery.

Gold gained roughly 5% last week, while silver rose 5.6%. Both still have ground to recover, but the rebound came amid a sharp selloff in technology shares. Oil and copper also fell, making precious metals’ resilience especially noteworthy.

The election helped change the mood. Democrat Party victories in both chambers of Congress raised expectations of constraints on the Trump administration and a better chance of easing the conflict with Iran.

Oil prices responded sharply, with Brent crude falling about 13% last week to roughly $98 a barrel. Monday brought further softening after President Trump indicated that additional attacks on Iran were highly unlikely while negotiations continued.

Cheaper oil gives gold and silver some breathing room. It eases inflation pressure, potentially reducing the need for further interest-rate increases. It also lowers costs for businesses and consumers.

Meanwhile, some major buyers have kept accumulating through the correction.

Gold investment funds attracted another $2.7 billion in October, their fourth consecutive month of inflows. Their gold holdings reached a record high, despite the month’s falling prices.

Central banks also remain substantial buyers. The World Gold Council estimates they purchased 321 tonnes during the third quarter, up 42% from a year earlier.

China added another 25.8 tonnes in October, extending its reported buying streak to two full years.

These buyers clearly see reasons to own gold beyond the next Fed announcement.

Silver’s recovery is still less convincing. It has bounced from below $49, but a sustained move above $55 would provide stronger evidence that the worst of the correction is behind it.

Tomorrow’s inflation report is the immediate test. Cooler numbers could help gold and silver extend their gains. Another hot reading could revive fears of higher rates and trigger fresh selling.

Last week nevertheless offered a useful reminder: when Wall Street’s favourite trades stumble, precious metals can move to a different beat.

A change in Congress does not erase Washington’s debts or restore purchasing power already lost to inflation. Gold and silver will remain volatile, but the broader reasons for owning physical metal have not gone away.