Gold, Silver Slump Sparks Domino Effect in Stocks: Markets Wrap

(Bloomberg) — Gold and silver extended their slump with stocks, as assets that had performed the best in January came under intense selling pressure following Friday’s dramatic market reversal.

The yellow metal plunged as much as 10% to briefly trade around $4,400 an ounce on Monday, after a rally that took it to nearly $5,600 in January. Silver plummeted as much as 16%, following a record 26% slump on Friday. Asian stocks had their worst two-day decline since early April, and futures indicated further losses for Europe and Wall Street benchmarks. Treasuries advanced.

Technology stocks fell as concerns over stretched valuations and heavy investment in AI drove MSCI’s Asian tech gauge to its steepest decline since November. As risk sentiment worsened, Bitcoin briefly slid below $75,000. The Bloomberg Dollar Spot Index extended the gains made on Friday, when President Donald Trump nominated Kevin Warsh as the next Federal Reserve chair.

“Traders are unnerved by the market tumult witnessed on Friday in precious metals,” said Tim Waterer, chief market analyst at KCM Trade. “Forced closures in precious metals amid margin increases are leading to the liquidation of other assets. So the slump in gold and silver is effectively having a domino effect on the rest of the market.”

Monday’s price actions point to mounting instability after a prolonged rally in precious metals and successive record highs in equities, driven by billions in AI investment. At the same time, investors are reassessing valuations and recalibrating expectations for monetary policy under a potential Warsh-led Fed amid repeated calls by Trump to lower rates.

With the pick of Warsh — an economist known as much for his fierce criticism of the central bank as his views on monetary policy — the debate has abruptly shifted from short-term rates to the Fed’s $6.6 trillion balance sheet and its very role in markets.

If confirmed by the Senate, the former Fed governor will succeed Jerome Powell when his term ends in May. Warsh, 55, aligned himself with Trump in 2025 by arguing publicly for lower rates, going against his longstanding reputation as an inflation hawk. The US president said Friday he had not asked Warsh to commit to cuts.

“Investors are worried about ‘higher for longer,’” Francis Tan, Asia chief strategist at Indosuez, said about US interest rates. “However, the market’s confusion is whether Trump will add pressure to send more doves the market’s way via Warsh. This causes the volatility across asset classes and geographies.”

What Bloomberg strategists say…

The selloff is accelerating now as though Asian traders are eager to dump assets to anticipate a fresh leg lower for metals and equities once London desks get going. The cascading series of lows for a broad range of assets, from gold to the Kospi, WTI crude and Nasdaq-100 futures, is taking on life of its own.

— Garfield Reynolds, MLIV Asia Team Leader. For full analysis, click here.

The MSCI All Country World Index — one of the broadest measures of equity markets — fell 0.5% as the Asian benchmark slid 2.4%. South Korea’s Kospi — a bellwether for the AI sector — plunged 5.3%, and Nasdaq 100 Index futures dropped more than 1.8% amid concerns about high valuations.

Losses in tech came after Nvidia Corp. Chief Executive Officer Jensen Huang said the company’s proposed $100 billion investment in OpenAI was “never a commitment” and that the company would consider any funding rounds “one at a time.”

“Jensen’s comments likely had a near‑term sentiment impact, particularly on AI‑exposed names that have rallied strongly,” said Gary Tan, a portfolio manager at Allspring Global Investments. “The remarks primarily served as a profit‑taking catalyst as we see some unwinding of crowded trades across the market.”

In political news, the US government stumbled into a partial shutdown Saturday while waiting for the House to approve a funding deal Trump worked out with Democrats following a national uproar over Border Patrol agents’ killing of a US citizen in Minneapolis.

Back to commodities, Brent crude oil plunged as much as 7.4%, while copper slumped more than 5% in a broad metals selloff. But the market’s attention was mostly on gold and silver.

Over the last year, precious metals have risen to all-time highs that have shocked even seasoned traders. The rally accelerated sharply in January, as investors piled into gold and silver on renewed concerns about geopolitical upheaval, currency debasement and the independence of the Fed. A wave of buying from Chinese speculators added froth to the rally.

“Sentiment has turned defensive – but this is mainly risk trimming – not so much panic,” said Billy Leung, an investment strategist at Global X Management. “Overall sentiment is weak.”

Corporate News:

Oracle Corp. said it plans to raise $45 billion to $50 billion in 2026 to build additional capacity for its cloud infrastructure through a combination of debt and equity sales. Waymo, Alphabet Inc.’s autonomous driving unit, is aiming to raise about $16 billion in a financing round that would value the unit at nearly $110 billion, according to people familiar with the matter. Some of the main moves in markets:

Stocks

S&P 500 futures fell 1.4% as of 6:50 a.m. London time Nasdaq 100 futures fell 1.8% The MSCI Asia Pacific Index fell 2.4% Hong Kong’s Hang Seng fell 3.2% The Shanghai Composite fell 2.5% Euro Stoxx 50 futures fell 1.1% Currencies

The Bloomberg Dollar Spot Index rose 0.2% The euro was little changed at $1.1853 The Japanese yen rose 0.1% to 154.62 per dollar The offshore yuan rose 0.1% to 6.9490 per dollar The British pound fell 0.1% to $1.3672 Cryptocurrencies

Bitcoin fell 0.3% to $76,168.92 Ether fell 3.3% to $2,213.06 Bonds

The yield on 10-year Treasuries declined two basis points to 4.22% Japan’s 10-year yield declined one basis point to 2.230% Australia’s 10-year yield was little changed at 4.80% Commodities

Spot gold fell 8.7% to $4,468.93 an ounce West Texas Intermediate crude fell 5.3% to $61.78 a barrel This story was produced with the assistance of Bloomberg Automation.

–With assistance from Gabrielle Ng and Sangmi Cha.

©2026 Bloomberg L.P.