Photographer: Luke Sharrett / Bloomberg
Photographer: Luke Sharrett / Bloomberg
Silver rose at the opening of the week, with futures reaching $ 29 an ounce in minutes, while the Reddit-inspired frenzy that rocked the stock markets last week spread to commodities.
The extraordinary peak came after retail sites overwhelmed by the demand for bars and coins over the weekend. Stores like Apmex, Walmart for precious metal products in North America, said they were unable to process orders until Asian markets opened due to unprecedented consumption.
“It’s been crazy – over the weekend, we saw about three weeks of opening accounts in just a few days,” said John Feeney, business development manager at Guardian Vaults in Sydney. “Silver shot up at the opening this morning when all that weekend volume hit the market.”
Silver futures ended almost 6% higher last week, after a jump on Thursday and Friday amid Reddit-style enthusiasm of hordes of retail investors. Unlike shabby stocks targeting the stock market, including GameStop Corp., silver performed well last year, rising more than 50% as the dollar fell and expectations of a global recovery from the pandemic.
The most active futures gained up to 8.7%, to $ 29.25 an ounce at Comex, the highest price since September, and traded at $ 28,855 at 7:51 am in Singapore. Gold futures rose 1.1% to $ 1,870 an ounce
“Given that there are many retail investors interested and aware of this story – and who are likely to be motivated and committed – the price may run even further,” said Nicholas Frappell, global general manager at ABC Bullion in Sydney.
Comments about silver started appearing on the Reddit r / wallstreetbets forum last week. People started to urge each other to pile on the iShares Silver Trust, the largest product traded on the metal exchange, claiming that banks have kept silver prices artificially low, masking a real shortage of supplies.
Still, some of the biggest Wall Street banks have been positive about silver prospects in recent months, amid a broad increase in raw materials. Goldman Sachs Group Inc. described it as the “preferred precious metal,” according to a January 27 note that had a price target of $ 30 an ounce.
In addition, money managers have had a net long position in silver since mid-2019, according to data on futures and options from the Commodity Futures Trading Commission. In the week of January 26, the net-bullish bets on metal were at a three-week high.
Silver is usually more volatile than its much more expensive sister metal, gold, usually with sudden price fluctuations. In addition to its role as a speculative asset and a store of value, it has industrial uses, namely in solar panels.
– With the help of Jake Lloyd-Smith, Matt Turner, Yvonne Yue Li, Ranjeetha Pakiam and James Thornhill