Gold Gains on Geopolitical Woes as Stocks See Weekly Downturns
Last week, gold and silver notched respective weekly downturns of 1% and 3% as investors evaluated the implications of a more hawkish Fed in 2025. This week was shortened in terms of trading days, as major markets were closed on Wednesday, in observance of New Year’s Day.
With no obvious catalyst, U.S. stocks dipped during a choppy trading session on Monday. Meanwhile, gold dipped by 0.6% amid thin trading, ending the day near $2,607.
Gold and silver bounced on Tuesday, as the dollar index dipped, and traders underwent position evening. Despite little change on Tuesday, gold ended the year 25% higher, outperforming both the S&P 500 and Dow Jones Industrial Average, for its best year since 2010. Silver also recorded a strong yearly uptick of 24%, at $29.51 an ounce.
Despite late-year volatility, equities secured significant gains in 2024, with the tech-heavy Nasdaq Composite gaining nearly 30%. Meanwhile, the Dow posted a more modest 13% yearly gain, and the S&P 500 closed the year 23% higher.
Stocks began the year on shaky footing, surrendering early gains on Thursday as major indices faced pressure from declines in Apple and Tesla shares. The latter gave up 6% after reporting a decline in deliveries for 2024. Elsewhere, gold and silver found support in the first trading session of the year, as the dollar index retreated from a two-year peak of 105.582.
Bullion found additional support during Thursday’s trading after reports of a Russian drone strike in Ukraine on New Year’s Day. These events, coupled with a decline in bond yields, contributed to gold rising 0.9% to close at a three-week high of $2,659, while silver was modestly higher at $29.59 an ounce.
Gold eased today, pressured by dollar strength, but still managed to end the week 0.5% higher, at $2,638. Silver also encountered pressure from a robust dollar this morning but ended the week with a 0.6% gain at $29.62 an ounce.
Major Wall Street averages re-gained footing this morning, after a shaky start to the new year. The Nasdaq Composite secured the most significant daily uptick of the three major averages, at 1.8%, but still ended the week 1.4% lower. The S&P 500 and Dow fared slightly better, with 1.1% and 0.95% respective weekly losses.