Gold, Silver Rally Outpaces Stocks Amid Rising Geopolitical Tensions

Gold and silver are back in the spotlight as global uncertainty drives investors toward safe-haven assets. Over the past two weeks, precious metals have significantly outperformed equities, fueled by a mix of geopolitical tensions, economic uncertainty, and upcoming central bank decisions.

Safe-Haven Demand Boosts Gold and Silver

In a period where stock markets like Sensex and Nifty have remained nearly flat, precious metals have surged. Gold prices have jumped nearly 6.5% on the Comex, while silver has recorded a robust 10% gain. These sharp gains reflect a growing preference among investors for assets that can preserve value during turbulent times.

The rally is not without cause. Experts point to multiple global triggers — the ongoing Russia-Ukraine conflict, renewed concerns around global trade wars, and crucial central bank meetings on the horizon. Together, these factors have created a climate of caution in equity markets and strong momentum in commodities.

Strong Momentum in Global and Indian Markets

Globally, gold prices rose from $3216 per ounce on May 14 to nearly $3423, while silver surged from $32.44 to $36 per ounce during the same period. Many trading sessions even saw intraday spikes of more than 2%, reflecting high investor interest.

In India, the trend mirrored global movement, albeit with slightly lower intensity. On the MCX, gold prices rose over 3.5%, while silver gained around 5.25% since May 14. Despite being relatively modest compared to global gains, these figures still underscore strong domestic buying interest.

Equities Take a Backseat

While precious metals glittered, Indian stock markets struggled to maintain momentum amid global uncertainty. Both the Sensex and Nifty remained range-bound, with volatility keeping investors cautious. As a result, gold and silver clearly outperformed equities during this period.

Outlook: Rally Likely to Sustain

Given the prevailing market sentiment, analysts believe the rally in gold and silver may extend further, especially if geopolitical tensions and macroeconomic concerns persist. With central bank policies, inflation cues, and global conflicts still dominating headlines, the appeal of precious metals as a hedge remains strong.