Gold and Silver Bullion Up 5.3% and 3.4% In January as Stocks Fall Sharply

Gold and silver rallied (5.3% and 3.4% respectively) in January, as stocks fell sharply.

Turmoil and sharp falls in Chinese and global stock markets, plunging oil prices, rising stress in credit markets and further signs of weak US and global growth led to a renewed bout of risk aversion in January.


This once again led to increased demand for traditional safe-haven assets – gold and silver.

Gold’s best monthly gain in dollar terms in a year, contrasted sharply with the sharp drop in US equities. For the month, the S&P 500 shed 5.1% – the sharpest fall in the S&P 500 index since the Greek debt crisis broke in May 2010. It was the S&Ps worst monthly start to a year since 2009 and other international stock indices had there worst monthly start to the year since 2008.

The DJIA lost 5.5%, for the biggest monthly losses since August and the biggest January declines since 2009. The Nasdaq plunged 7.9%, its worst month since May 2010.

U.S. stocks as measured by the Russell 3000 index fell 5.74% in the month. Tech darlings Apple and Amazon were the largest contributors to the decline. Apple fell 7.52% in the month, while Amazon fell 13.15%.

Europe’s benchmark Stoxx 600 saw January losses of 6.4pc and the DAX was 8.9% lower with vulnerable Deutsche Bank collapsing over 25%.

Emerging markets equities as measured by the MSCI Emerging Markets index fell 9.06%. The Chinese stock market, the Shanghai Composite Index, collapsed 23 percent, the biggest monthly drop since October 2008 and the worst performance among 93 equity indices tracked by Bloomberg internationally.

Brokers and Wall Street strategists had predicted another 10 percent gain for equities in 2016. Wall Street and others bullish predictions are now being revised downwards as measures of investor anxiety reach levels not seen in a few years.

The risk-off trade  saw flows into gold and silver and also into U.S. bonds. While the dollar fell versus gold, other currencies fared worse than the dollar. The New Zealand dollar fell more than 5% in the month vs. the U.S. dollar and sterling fell 3.66%.

Ultra loose monetary policies globally, the BOJ negative interest rates and increasing speculation that the Federal Reserve will have to delay further interest-rate increases is burnishing gold’s appeal and bodes well for gold in 2016.

Precious Metal Prices

1 Feb: USD 1,122.00, EUR 1,032.86 and GBP 785.60 per ounce
29 Jan: USD 1,112.90, EUR 1,019.89 and GBP 776.84 per ounce
28 Jan: USD 1,119.00, EUR 1,026.14 and GBP 781.59 per ounce
27 Jan: USD 1,116.50, EUR 1,027.14 and GBP 781.04 per ounce
26 Jan: USD 1,114.70, EUR 1,028.42 and GBP 785.80 per ounce

Most Popular Guides In 2015

Protecting Your Savings In The Coming Bail-In Era

From Bail-Outs To Bail-Ins: Risks and Ramifications

Essential Guide To Storing Gold In Singapore

Essential Guide To Storing Gold In Switzerland

7 Key Storage Must Haves

10 Important Points To Consider Before You Buy Gold

Essential Guide to Tax Free Gold Sovereigns

Please share our research with family, friends and colleagues who may benefit from being informed by it.

Mark O’Byrne

Research Director

Mark OByrne

  • tom d

    If they have any rules they do not enforce them on the metal markets. That allows 4 major USA banks to hold so many shorts that the count is actually over 230 oz of short silver to ever physical silver oz. If someone was to attempt to make a run and force the shorts the banks can just short until the person attempt to do it was bankrupt. The hunts brothers discovered the ability of central bankers to destroy the very meaning of precious metals. It would be wonderful if central bankers were actually doing something for the world other than making millionaires into billionaires. The Federal Reserve has watched the purchase power of the US dollar to lose over 99 percent of it purchase power. We have had continue financial disasters while the fed did little or the wrong thing. Jackson was correct in getting rid of the central bank. Now if we can only find a way to destroy the monster of a central bank. An organization which refuses to provide what action it has taken.