Editor’s Note
This report highlights a broad downturn across major asset classes, from precious metals and equities to cryptocurrencies, amid renewed investor anxiety. The simultaneous declines suggest a climate of heightened risk aversion and market uncertainty.
International gold and silver prices have once again fallen sharply. As concerns about an AI bubble resurfaced, the New York stock market could not avoid a downturn. There are laments that the cryptocurrency market has entered a ‘stage of despair’. Reporter Jang Hyo-in reports.
International gold and silver prices have fallen sharply. On the 5th (local time), spot gold prices fell by about 2%, and silver prices plunged by 12%. After staggering from the ‘Warsh Shock’ at the end of last month, the prices of precious metals, which had been on a high-flying streak, are showing a rollercoaster trend. The US dollar rebounded after former Federal Reserve Governor Kevin Warsh, known for his hawkish stance, was nominated as the next Fed chair candidate, putting downward pressure on precious metal prices.
The New York stock market closed lower across the board as panic selling spread throughout the market due to the re-emergence of ‘Artificial Intelligence (AI) bubble’ concerns. The Dow Jones and S&P 500 indices fell by about 1.2%, and the tech-heavy Nasdaq index dropped by about 1.6%. Amid concerns over ‘over-investment’, shares of Alphabet, Microsoft, and Amazon declined, while Nvidia fell about 1% and Palantir plunged about 7%, unable to avoid the selling spree.
Bitcoin, the top cryptocurrency by market capitalization, was pushed below the psychological resistance level of $70,000 and at one point slid to $60,000. Compared to its all-time high in October of last year, it has been cut in half. In the Korean won market, it briefly fell below 100 million won, hitting its lowest level in one year and four months. Ethereum, the second-largest by market cap, also saw the $2,000 level collapse.
Analysis suggests that cryptocurrencies are facing a ‘crisis of narrative’ because they have failed to act as safe-haven assets and have instead moved in sync with tech stocks, amplifying volatility.
As risk-aversion sentiment intensified in the New York stock and cryptocurrency markets, New York oil prices plunged nearly 3% as the US and Iran agreed to hold talks.