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Silver slide and AI worries weigh on markets

Silver’s dramatic reversal from a record rally deepened on Thursday, while gold held comparatively steady. Risk appetite was further hit as bitcoin and oil fell, and global equities weakened amid mounting concerns that rapid advances in artificial intelligence could disrupt existing business models, prompting a rotation out of technology stocks. European markets were more resilient, with Switzerland’s SMI touching a record high even as the EuroStoxx 50 eased ahead of closely watched interest rate decisions from the European Central Bank and the Bank of England later on Thursday. On the corporate side, investors will be watching Amazon earnings, which could set the tone for market sentiment into the end of the week.

  • Data
  • Autore Shane Strowmatt, Senior Investment Writer
  • Tempo di lettura 5 minuto

Silver bars

The roller coaster ride in silver prices continued late in the week with spot prices dropping about 12% on Thursday to less than USD 80, as the metal’s sharp two-day rebound abruptly reversed. The slide follows an almost 30% crash last Friday that interrupted a record rally in which silver had gained about 146% in 2025. Rising margin requirements across metals exchanges, including recent increases by CME Group after last week’s steep sell-off, are forcing out speculators and amplifying price moves as dealer hedging turns procyclical and investor stop-loss orders are triggered. Gold prices have been relatively resilient, declining just 1% to around USD 4920 per ounce. Meanwhile, bitcoin fell below USD 71,000 per token on Wednesday, extending a recent slide that has left the world’s largest cryptocurrency down about 20% since the start of the year after US Treasury Secretary Scott Bessent said that neither the Treasury nor the Financial Stability Oversight Council has authority to buy bitcoin or other cryptocurrencies, dampening any expectations of a government backstop. In energy markets, oil prices fell more than 2% on Thursday after the United States and Iran confirmed plans to hold talks in Oman on Friday, easing anxiety that a military clash could curb supply from the Middle East.

Asia stocks fall on tech volatility

Asian equity markets declined on Thursday after a sharp sell-off in US technology shares, with concerns that rapid advances in artificial intelligence could disrupt existing business models and squeeze profit margins prompting investors to take profits. South Korea’s KOSPI led losses, dropping more than 4% from recent record highs, as heavyweight chipmakers Samsung Electronics and SK Hynix plummeted. In Japan, the Nikkei 225 eased 0.8% from its own record levels, although strong earnings from industrial group Panasonic and chipmaker Renesas Electronics helped limit broader declines, leaving the TOPIX little changed.  Australia’s S&P/ASX 200 was 0.4% weaker and Hong Kong’s Hang Seng Index was trading 0.8% lower. Mainland China’s CSI 300 and India’s Nifty 50 were also in negative territory, both slipping around 0.5%.

US stocks diverge as Dow nears record

US equity markets closed mixed on Wednesday, with the Dow Jones Industrial Average rising 0.5% to 49,501.30 points, moving back near its record high from the previous day, while the S&P 500 fell 0.5% to 6882.72 points and the technology-heavy Nasdaq 100 fell 1.8% to 24,891.24 points, its lowest level since November 2025. The moves reflected an ongoing sector rotation, as investors sold software and IT names on concerns that advances in artificial intelligence could disrupt business models, while cyclical and defensive stocks gained ground. Chipmaker AMD dropped 17.3% after issuing a disappointing revenue outlook seen as signalling slower-than-expected progress in AI. By contrast, US pharmaceutical stocks provided support, with Eli Lilly jumping 10.3% and regaining a market capitalisation above USD 1 trillion on the back of strong guidance for weight-loss products, and Amgen advancing 8.2% after reporting much stronger-than-expected quarterly earnings. The macroeconomic backdrop was less supportive, with US private-sector employment increasing by only 22,000 jobs in January, according to ADP data released on Wednesday, down from a downwardly revised gain of 37,000 in December and well below market expectations for a stronger rise.

Alphabet plans sharp rise in AI capex

Google parent company Alphabet signalled a major step-up in investment on Wednesday, projecting capital expenditure of USD 175 billion to USD 185 billion in 2026, with the upper end more than twice its 2025 outlays. The spending, which exceeds capex guidance from other large cloud providers, will focus on artificial intelligence computing capacity for Google DeepMind, expanding cloud infrastructure to meet strong customer demand and funding selected “other bets”, after cloud revenue rose nearly 48% year-on-year and backlog jumped 55% sequentially to USD 240 billion in the fourth quarter.

European stocks mixed as Swiss index hits record

European equity markets ended Wednesday mixed, with the euro area’s EuroStoxx 50 index slipping 0.4% to 5970.47 points while Switzerland’s SMI rose 1% to a record intraday high just below 13,590 points before closing at 13,508.12. Hopes that the EU may soften its emissions trading scheme supported chemical and automotive stocks, helping names such as BASF, Air Liquide, BMW, Mercedes and VW, while weakness in technology shares limited broader gains. The upcoming European Central Bank policy decision on Thursday drew little immediate reaction, although easing inflation and a stronger euro are likely to intensify calls for rate cuts.

Corporate and economic calendar

Economic data in focus: euro-area retail sales (11:00), Bank of England interest rate decision (13:00), European Central Bank interest rate decision (14:15), and US weekly initial jobless claims (14:30).

Corporate news in focus: Quarterly figures from Amazon, BBVA, BNP Paribas, Bristol-Myers Squibb, Cigna, ConocoPhillips, Linde, Mitsubishi, Siemens Healthineers, Unilever, and Vinci.

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Publisher: LGT Bank (Switzerland) Ltd., Glärnischstrasse 36, CH-8027 Zurich
Editor: Alessandro Fezzi
Source: LGT Bank (Switzerland) Ltd.