Stocks soar, high in retail leads silver to high in eight years

NEW YORK (Reuters) – Global stocks rebounded from last week’s strong liquidation and silver prices soared on Monday, with retail investors expanding their social media-fueled battle with Wall Street to bring the precious metal to a halt. eight-year high.

A shift in the retail frenzy for silver boosted mining stocks on both sides of the Atlantic, with a 7.2% jump in the iShares Silver Trust ETF – the largest silver-backed ETR – has put it on the right track since 2008.

ETF data showed that its silver holdings jumped to a record 37 million shares from Thursday to Friday alone, each representing an ounce of silver.

Mining giants BHP Group, Glencore Plc and Anglo American Plc were the six biggest FTSE 100 winners in London, with the blue-chip closing at 0.92%.

Mining company Fresnillo rose 8.95% to 1,076 to help lead the pan-European STOXX 600 index by 1.24%.

On Wall Street, nine of S & P’s 11 major sectors have moved forward, with technology leading the way.

Silver prices rose to an eight-year high of just over $ 30 an ounce, before reducing trading gains by 6.3% higher to $ 28.70.

The frenzy of trading on social media generated huge gains at companies like GameStop Corp last week, forcing hedge funds to hedge their short positions and generating volatility on Wall Street. The top three stock indices recorded their biggest weekly declines since October.

GameStop fell 27.31% to $ 236.23.

“Silver has indirect effects compared to GameStop because it has links to mining companies,” said Connor Campbell, financial analyst at SpreadEx. “If you start pushing silver upwards, it will have an effect on other industries and other markets and that is clearly what happened.”

Silver has gained 19% in price since Thursday, after publications on Reddit prompted small investors to buy silver mining stocks and exchange-traded funds (ETF) backed by physical silver bars, in a GameStop-style grip.

Spot silver was up 6.33% to $ 28.71.

The MSCI benchmark for global equity markets increased 1.6% to 653.19.

On Wall Street, the Dow Jones Industrial Average was up 1.06%, the S&P 500 was up 1.82% and the Nasdaq Composite was up 2.67%.

The US dollar jumped to a 2-week high due to the weakness of the euro, the Swiss franc and the Japanese yen, with the view that the United States has an advantage in growing its economy and vaccinating its population against COVID- 19.

The euro weakened after Germany reported that retail sales unexpectedly plunged 9.6% in December, after stricter blocks last year to contain the spread of COVID-19 that stifled consumer spending in Europe’s largest economy.

The dollar index rose 0.393%, with the euro falling 0.59% to $ 1.2064.

The Japanese yen weakened 0.25% against the US dollar to 104.92 per dollar.

Oil prices have soared, driven by reduced inventories and hopes for a faster global economic recovery, although interruption of vaccine launches and new travel restrictions have limited gains.

Brent oil futures liquidated $ 1.31 to $ 56.35 a barrel. American oil futures rose $ 1.35 to close at $ 53.55 a barrel.

Gold followed up, up 0.70% to $ 1,859.05 an ounce. US gold futures hit 0.7% at $ 1,863.90.

(Graph: silver has outpaced gold in terms of price and ETF holdings in the past few months 🙂

Overnight data showed that Chinese plant activity slowed in January, as restrictions affected some regions. In the euro zone, manufacturing growth remained resilient at the beginning of the year, but the pace has slowed since December.

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

Although the global launch of the coronavirus vaccine remains slow, with concerns that it will work on new strains of COVID, Europe was also driven by news that it will receive an additional 9 million doses of AstraZeneca in the first quarter.

With the recovery of riskier markets, yields on Italian government bonds fell 2-3 basis points along the curve.

German Bund’s yields, in turn, the benchmark for the eurozone, remained anchored at around -0.51% on Monday, following the yields of the US Treasury. The 10-year US Treasury note was traded to yield 1.0723%.