Breaking News
Get Actionable Insights with InvestingPro+: Start 7 Day FREE Trial Register here
Investing Pro 0
Ad-Free Version. Upgrade your Investing.com experience. Save up to 40% More details

Global shares rally, retail surge drives silver to 8-year high

Stock MarketsFeb 01, 2021 07:15AM ET
Saved. See Saved Items.
This article has already been saved in your Saved Items
 
2/2 © Reuters. The German share price index DAX graph is pictured at the stock exchange in Frankfurt 2/2

By Simon Jessop

LONDON (Reuters) - Global shares bounced and silver markets surged on Monday as retail investors expanded their social media-fuelled battle with Wall Street to drive the precious metal to an eight-year high.

Stock markets were roiled last week after a spike in retail demand to buy the stocks most bet against by hedge funds drove huge gains in companies such as GameStop Corp (NYSE:GME), and prompted fresh concern that COVID-19 monetary and fiscal support measures were fuelling a market bubble.

With chatrooms abuzz with talk that silver was the new target, silver-exposed stocks, funds and coins jumped, helping push spot silver up more than 11%, before gains were trimmed and it last traded up around 9%.

The bullish spirit helped London-listed miners post strong gains, including one of more than 19% for Fresnillo (LON:FRES)

After falling 3.6% last week - its biggest weekly fall in three months - the MSCI All-Country World Index rose 0.5% by midday, tracking overnight gains in Asia.

Wall Street looked set for an even stronger bounce-back, with futures for the S&P 500 and NASDAQ both up around 1.2%. The VIX 'fear gauge' was down 7%.

While the retail battle versus Wall Street, coordinated over online forums such as Reddit, created some systemic risks, the bigger danger was in the tech sector, where some stocks had "eye watering valuations", Deutsche Bank (DE:DBKGn) analyst Jim Reid said.

"Retail has in many parts driven such valuations in the last 10 months. If this pops the wider market will have bigger issues than last week."

However, with corporate earnings still beating expectations - around 82% of S&P 500 delivering a positive surprise - Kristina Hooper, Chief Global Market Strategist at Invesco, said investors should look through the recent volatility.

"We have to keep in mind that in general, stock market fundamentals are solid."

Gold followed silver higher, up 0.8% to $1,859 an ounce, while oil also tracked the gains in other commodities, with both Brent crude and its U.S. peer up around 1%. [O/R]

Graphics: Silver has outperformed gold in price terms and in ETF holdgings in recent months - https://fingfx.thomsonreuters.com/gfx/ce/ygdvzagndpw/SilvervsGold.png

While the stock market tussle continued to grab the headlines, analysts cautioned that the bigger concern was economic momentum as coronavirus lockdowns bite.

Data overnight showed Chinese factory activity slowed in January as restrictions took a toll in some regions. In the euro zone, manufacturing growth remained resilient at the start of the year but the pace waned from December.

British data showed an even greater struggle, with manufacturers facing the twin headwinds of COVID-19 and Britain's exit from the European Union.

While the coronavirus vaccine rollout globally remains slow, with concern about whether they will work on new COVID strains, Europe was also bolstered by news that it would receive a further 9 million doses from AstraZeneca (NASDAQ:AZN) in the first quarter.

The safe-haven dollar edged higher during the morning session in Europe, with the dollar index last at 90.876 , having bounced from a trough of 89.206 hit early in January.

The euro, meanwhile, extended earlier losses against the dollar, down 0.5% to $1.2075, well off its recent peak at $1.2349, while the pound gave up some of its early gains to trade up 0.1% on the day at $1.3705..

With riskier markets bouncing, Italian government bond yields fell 2-3 basis points across the curve.

German Bund yields, meanwhile, the benchmark for the euro zone, remained anchored around -0.51% on Monday, tracking U.S. Treasury yields that also remained unchanged..

Global shares rally, retail surge drives silver to 8-year high
 

Related Articles

Add a Comment

Comment Guidelines

We encourage you to use comments to engage with other users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind:  

  •            Enrich the conversation, don’t trash it.

  •           Stay focused and on track. Only post material that’s relevant to the topic being discussed. 

  •           Be respectful. Even negative opinions can be framed positively and diplomatically. Avoid profanity, slander or personal attacks directed at an author or another user. Racism, sexism and other forms of discrimination will not be tolerated.

  • Use standard writing style. Include punctuation and upper and lower cases. Comments that are written in all caps and contain excessive use of symbols will be removed.
  • NOTE: Spam and/or promotional messages and comments containing links will be removed. Phone numbers, email addresses, links to personal or business websites, Skype/Telegram/WhatsApp etc. addresses (including links to groups) will also be removed; self-promotional material or business-related solicitations or PR (ie, contact me for signals/advice etc.), and/or any other comment that contains personal contact specifcs or advertising will be removed as well. In addition, any of the above-mentioned violations may result in suspension of your account.
  • Doxxing. We do not allow any sharing of private or personal contact or other information about any individual or organization. This will result in immediate suspension of the commentor and his or her account.
  • Don’t monopolize the conversation. We appreciate passion and conviction, but we also strongly believe in giving everyone a chance to air their point of view. Therefore, in addition to civil interaction, we expect commenters to offer their opinions succinctly and thoughtfully, but not so repeatedly that others are annoyed or offended. If we receive complaints about individuals who take over a thread or forum, we reserve the right to ban them from the site, without recourse.
  • Only English comments will be allowed.

Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at Investing.com’s discretion.

Write your thoughts here
 
Are you sure you want to delete this chart?
 
Post
Post also to:
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Thanks for your comment. Please note that all comments are pending until approved by our moderators. It may therefore take some time before it appears on our website.
Comments (1)
Bob Murphy
Bob Murphy Feb 01, 2021 8:00AM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
You can file this article in the trash can.
alex gallegos
alex gallegos Feb 01, 2021 8:00AM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
WOW! Your ****
 
Are you sure you want to delete this chart?
 
Post
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Add Chart to Comment
Confirm Block

Are you sure you want to block %USER_NAME%?

By doing so, you and %USER_NAME% will not be able to see any of each other's Investing.com's posts.

%USER_NAME% was successfully added to your Block List

Since you’ve just unblocked this person, you must wait 48 hours before renewing the block.

Report this comment

I feel that this comment is:

Comment flagged

Thank You!

Your report has been sent to our moderators for review
Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.
Continue with Google
or
Sign up with Email