U.S. Stocks Rebounded, but Precious Metals Took a “High-Dive Plunge”

Market Overview

Last Friday, optimism over a potential easing in trade tensions lifted U.S. equities from early losses to close higher, with all three major indexes posting weekly gains of over 1%. Previously pressured regional bank stocks surged as earnings reports eased concerns over bad loans—the regional banking index rose nearly 2%, while Zions and Western Alliance, which had plunged on Thursday, rebounded by about 6% and over 3%, respectively.

The semiconductor index snapped its two-day winning streak but still advanced nearly 6% for the week. Oracle, after gaining against the market a day earlier, fell nearly 7%.

U.S. Treasury prices retreated as well. The two-year Treasury yield, highly sensitive to rate expectations, rebounded after touching a three-year low intraday. However, on a weekly basis, it still marked its third consecutive decline.

Gold and silver experienced extreme volatility. Both hit new record highs intraday before suffering a “high-dive plunge.” Spot gold tumbled more than 3% at one point, while silver fell nearly 7%. Despite the sharp pullback, gold logged its ninth straight weekly gain, with futures rising over 5%—its biggest weekly advance in nearly five months.

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● Earnings Reports Ease Bad Loan Fears

Regional banks, which saw their sharpest sell-off in six months on Thursday due to loan fraud concerns, rebounded Friday after several lenders reported lower-than-expected loan loss provisions. Executives sought to reassure rattled investors about the stability of credit quality. The KBW Bank Index closed 0.51% higher, with Truist, Fifth Third, and Ally Financial all emphasizing solid credit performance and vigilance toward specific risks.

● Trump Administration “Adjusts” Tariff Strategy

The Trump administration is revising its trade policy by exempting dozens of products from tariffs and expanding waiver provisions for trade agreements. At the same time, the administration is broadening the use of tariffs under Section 232 of the Trade Expansion Act of 1962 to include heavy trucks, pharmaceuticals, and furniture. This move aims to hedge against legal risks if the Supreme Court overturns the “reciprocal tariff” policy. Should the court rule against the administration, the White House may be forced to refund a substantial amount of previously collected tariffs.

Key Focus (GMT+8)

16:00 EU – Eurozone August Current Account (seasonally adjusted, € billions)