Oil and Silver Lead Commodity Losses, Stocks Fall: Markets Wrap
(Bloomberg) — Oil fell for the first time in six days after President Donald Trump signaled he may hold off on attacking Iran for now. Precious metals also slipped from their record highs.
Brent crude dropped as much as 3.3% Thursday as Trump said he was reassured by sources “on the other side” that the government in Tehran would stop killing people involved in widespread protests. Even so, Iran temporarily closed airspace around its capital amid tensions with the US.
Silver tumbled as much as 7.3% as Trump held off on imposing new tariffs on imports of critical minerals. Gold, platinum and palladium also declined. Asia’s benchmark share index fell from a record high, while US equity-index futures also dropped after S&P 500 Index had its first back-to-back loss for the year.
While commodities retreated from their highs, the main theme in stocks was investors rotating out of richly valued technology shares. With key economic data from the US not moving expectations for a Federal Reserve interest-rate cut until the middle of the year, traders are turning their attention to how the rotation will pan out, especially since Asian shares have outpaced gains on Wall Street.
“There is definitely rotation going on, rather than serious fatigue,” said Billy Leung, an investment strategist at Global X Management. “Looking at broader strength is actually what I want to see especially with recent rally driven by tech.”
Thursday’s pullback in precious metals came after the majority of commodities had powered ahead this year, extending gains from 2025.
A broad metals rally sent silver and gold to fresh peaks on Wednesday, along with copper and tin, as investors turned to hard assets due to an array of geopolitical, economic and supply risks. Frenzied buying in China and the US, and a broader rotation into commodities are bolstering demand.
Concerns about US tariffs on silver, along with platinum and palladium, were temporarily eased as Trump said he would negotiate bilateral agreements to ensure adequate supplies of critical minerals. He floated price floors on imports — not just percentage-based tariffs — to develop supply chains, but didn’t rule out levies in future, according to a statement late on Wednesday.
What Bloomberg strategists say…
The swings in commodities highlight the extreme volatility being fed by President Trump’s mercurial policy style, though so far the declines for raw materials are still too small to seriously dent this year’s substantial rallies. There’s plenty of potential that investors will be itching to pile back in to commodities assets given how often they’ve bounced back to fresh highs following occasional corrections in recent weeks.
— Garfield Reynolds, Asia MLIV Team Leader. For full analysis, click here.
Elsewhere in Asia, the South Korean won weakened after jumping Wednesday when US Treasury Secretary Scott Bessent referred to excessive declines in the currency. His comments represented rare verbal support for the won as it slides toward its weakest since 2009.
“Bessent’s comments can support the won in the near term, but markets may have more influence if they feel the fundamentals and politics are still in a worsening trajectory,” said Brendan McKenna, a strategist at Wells Fargo in New York.
The Bank of Korea left its benchmark rate unchanged in a widely predicted policy decision.
Attention was also on Japan, where Prime Minister Sanae Takaichi was expected to call a snap election early in the parliamentary session starting later this month. Equities in the country had rallied and the yen had come under pressure amid reports of a snap poll.
The yen fluctuated after Bessent spoke with Japanese Finance Minister Satsuki Katayama and noted the “inherent undesirability of excess exchange rate volatility.”
Elsewhere, Trump told Reuters he does not plan to fire Fed Chair Jerome Powell despite a Justice Department probe into the central bank’s renovation.
Corporate Highlights:
The Toyota group sweetened a bid to privatize a key unit on the eve of its tender period, but that’s unlikely to placate investors who say the new price still undervalues the company. Alibaba Group Holding Ltd. plans to link its flagship online shopping and travel services to its AI app. Alphabet Inc.’s Google said its Gemini artificial intelligence assistant can now proactively tap into users’ data across Gmail, Search, Photos and YouTube, an attempt to make its consumer-facing AI product more personalized. Some of the main moves in markets:
Stocks
S&P 500 futures were little changed as of 2:14 p.m. Tokyo time Nikkei 225 futures (OSE) fell 0.7% Japan’s Topix rose 0.8% Australia’s S&P/ASX 200 rose 0.5% Hong Kong’s Hang Seng fell 0.4% The Shanghai Composite fell 0.5% Euro Stoxx 50 futures rose 0.1% Currencies
The Bloomberg Dollar Spot Index was little changed The euro was little changed at $1.1637 The Japanese yen was little changed at 158.55 per dollar The offshore yuan was little changed at 6.9691 per dollar Cryptocurrencies
Bitcoin fell 1.3% to $96,309.11 Ether fell 1.9% to $3,308.85 Bonds
The yield on 10-year Treasuries advanced one basis point to 4.14% Japan’s 10-year yield declined two basis points to 2.160% Australia’s 10-year yield declined three basis points to 4.69% Commodities
West Texas Intermediate crude fell 3.3% to $59.97 a barrel Spot gold fell 0.8% to $4,589.31 an ounce This story was produced with the assistance of Bloomberg Automation.
–With assistance from Ruth Carson, Winnie Zhu, Lin Zhu and Yihui Xie.
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