Precious Metals Enter “Mania Mode” After Christmas, but Margin Hike Risks Loom

Market Overview

On Friday, marking the opening session of the final trading week of 2025, U.S. equities consolidated near record highs. The S&P 500 stood less than 1% away from the psychologically significant 7,000 level, fueling broad expectations that the index could break through this milestone and cap off a strong year.

While recent momentum in the technology sector has softened, gains in financials, healthcare, and small-cap stocks helped sustain overall market breadth. At the sector level, semiconductors saw a rebound in sentiment, supported by strength in SK Hynix shares, while news that Leapmotor plans to issue shares to FAW Group also drew market attention.

On the macro and FX front, investors are closely watching the upcoming release of the December FOMC meeting minutes, which may offer clues on the pace and timing of rate cuts in 2026. The U.S. dollar index hovered near the 99 level, while the Chinese yuan continued to demonstrate strong internal momentum, extending its appreciation trend. Meanwhile, the Japanese yen rebounded for a fourth consecutive session after the Bank of Japan released meeting summaries signaling a relatively firm policy stance.

Commodities remained firmly in the spotlight:

Precious Metals Surge:

Physical tightness in the London silver market continued to intensify. Spot silver surged nearly 5% intraday, breaking above USD 83 per ounce, while COMEX silver futures jumped more than 6%. Spot gold fluctuated at elevated levels above USD 4,530 per ounce, while gold futures pushed beyond USD 4,580. In response to the heightened volatility, CME Group announced post-close increases in margin requirements for related metal futures.

Oil Rebounds:

Although former President Trumps remarks suggesting progress in Russia–Ukraine negotiations briefly weighed on risk sentiment, Brent crude found support at lower levels and reclaimed the USD 61 per barrel mark. In crypto markets, Bitcoin held firm, climbing back above USD 88,000, as investors closely monitor whether another year-end rally attempt is on the horizon.

Key Themes AheadCME Group Raises Margin Requirements Across Metal Contracts

As the world‘s leading derivatives exchange, CME Group released a major margin adjustment notice on December 26, announcing that it will raise maintenance margin requirements for a broad range of metal futures effective after the close on Monday, December 29. Market participants widely view this move as a clear signal of the exchange’s concern over abnormal volatility in precious metals.

According to CME Group, the margin hikes are designed to ensure sufficient collateral coverage amid sharp price swings. The adjustment applies to gold, silver, palladium, platinum, lithium, and related Trade at Settlement (TAS) contracts, spanning standard, mini, and micro contract sizes. In effect, the changes cover nearly all core metal products traded on CME platforms.

Crypto Becomes a “Tax-Loss Harvesting” Tool for U.S. Investors

Against the backdrop of a strong rally in U.S. equities and a pullback in Bitcoin this year, American investors are increasingly using cryptocurrencies as year-end tax-loss harvesting instruments. Because spot crypto assets are not subject to U.S. equity wash-sale rules, investors can sell losing Bitcoin positions to offset capital gains from stocks.

This “sell-into-weakness” behavior has surged toward year-end, emerging as a key strategy for managing portfolio divergence and reducing tax liabilities amid increasingly polarized asset performance.

Events to Watch (GMT+8)

23:00 (US)

U.S. November Pending Home Sales Index (MoM)

23:30 (US)

EIA Weekly Crude Oil Inventories (week ending December 19, in thousand barrels)