Chandigarh, Jan 30: A massive sell-off in the precious metals market on Thursday wiped out significant gains after gold and silver prices tumbled from their all-time highs. The retreat was largely driven by a contagion effect from the U.S. tech sector, where concerns over Microsoft’s cloud growth and AI investments triggered a wider market retreat. Silver, which had recently touched a record $121 per ounce internationally, led the decline with a 12 percent drop, while gold prices fell by nearly $500 per ounce.
In India, the price of silver has seen wild swings, retreating from its peak of Rs 4,20,000. Market experts noted that the metal had gained nearly Rs 40,000 in value in just fifteen days before this sharp correction. This volatility comes despite strong fundamental demand, as silver remains a critical mineral for global industry. However, the influence of speculative trading on international exchanges has introduced a level of instability that caught many retail investors off guard during the Thursday session.
“While global demand remains high due to the US classifying silver as a critical mineral and China restricting exports, the paper trade on exchanges is causing wild swings,” said Pankaj Arora, National President of the All India Jewellers and Gourmet Federation. Arora urged investors to remain patient through the turbulence, noting that while the long-term trajectory could see silver hit Rs 7 lakh, the market could see a significant interim dip to Rs 2.5 lakh before that target is realized.
The broader financial landscape remains clouded by shifting capital as investors struggle to find a stable environment. Sunil Shah of Khambatta Securities noted that when there is no clarity on the direction of the global economy, money often moves erratically between precious metals, bonds, and equity markets. This erratic movement has been particularly visible as investors react to the sudden cooling of the AI-driven tech rally in the United States.
“Now when does it happen, generally it happens when there is no clarity, there is the markets are full of uncertainty, what is going to happen nobody has clue,” Shah added. He noted that while global markets face this “safe haven” crash, the Indian equity markets have remained somewhat resilient. Investors in India are now turning their attention toward the central government’s upcoming Union Budget, which many hope will provide the necessary policy direction to stabilize domestic asset prices.
