Gold Wobbles and Stocks Recover as Trade Tensions Ease
Last week, gold shed over 5% as optimism surrounding U.S.-China trade talks diminished the metal’s safe-haven appeal. This week brought a packed calendar of economic events, with U.S. GDP and inflation data set for release on Wednesday, followed by employment reports on Thursday and Friday.
Gold began the week near $3,254 an ounce and climbed 0.5% on Monday, supported by bargain-hunting inflows. Elsewhere, U.S. stocks eked out gains in a volatile session, as investors braced for a full slate of big tech earnings and key macroeconomic data.
U.S. equities opened lower on Tuesday until Commerce Secretary Howard Lutnick announced that the Trump administration had reached a preliminary trade agreement, with a trading partner that wasn’t named. At the same time, the dollar index advanced, and gold declined amid renewed trade optimism and news that the administration would ease auto duties for domestic manufacturers. By Tuesday’s close, gold had fallen 1% to $3,308, while silver held steady near $32.90 an ounce.
Markets opened on shaky footing Wednesday following news that the U.S. economy contracted at an annual rate of 0.3% in the first quarter—its first contraction in three years. Stocks initially dropped on the GDP print but quickly rebounded as investors digested inflation data, which showed a slowdown in year-over-year PCE to 2.3%, down from 2.7% in February. As equities recovered, gold posted a modest gain, closing at $3,228 an ounce, as the economic data increased expectations for interest rate cuts in 2025.
On Thursday, strong earnings from companies like Microsoft and Meta lifted stocks, with the tech-heavy Nasdaq Composite leading the way with a 1.5% gain—its seventh consecutive daily increase. Meanwhile, gold wobbled amid easing U.S.-China tensions and a stronger dollar. By day’s end, gold hovered near $3,240, while silver was little changed at $32.09.
Gold extended its losses this morning following a stronger-than-expected non-farm payrolls report, which pressured bullion further. By the end of the week, gold was down 0.7%, closing at $3,229. Silver saw a slight rebound during the afternoon session but still ended the week down over 2%, at $32.02.
Today’s upbeat jobs report further buoyed equities, with both the S&P 500 and Dow clinching nine-day winning streaks. Tech strength propelled the Nasdaq to a 3.5% weekly gain, outperforming the S&P 500 and Dow, which each rose nearly 3% for the week.