Gold blew past $4,300 per ounce on Thursday for the first time in history, pushing its total market cap to $30 trillion, according to data provided by CNBC. Spot prices jumped to $4,312, while U.S. December futures hit $4,328.70, both shattering previous records.
Traders rushed into gold as tensions between the U.S. and China worsened, and as expectations built that the Federal Reserve could finally cut rates this month.
The surge wasn’t random. With risk piling up on all sides, from geopolitical heat to market jitters, investors started dumping cash into anything they believed wouldn’t collapse overnight. That asset, once again, turned out to be gold.
At the same time, Bank of America came out swinging with fresh forecasts. On Monday, the bank lifted its 2026 target for gold to $5,000, with an average price of $4,400. It also bumped its silver outlook to $65, averaging $56.25. According to the bank, for gold to reach $6,000, investors would need to boost buying by 28% from current levels.
Stocks drop as regional banks collapse under loan stress
While gold was ripping, equities were bleeding. The Dow Jones dropped 301.07 points, or 0.7%, to close at 45,952.24, erasing a 170-point gain earlier in the day. The S&P 500 lost 0.6%, landing at 6,629.07, and the Nasdaq slid 0.5% to 22,562.54. Red dominated the screens, especially in the banking sector.
Zions Bank took a brutal 13% hit after disclosing loan losses tied to two failed borrowers. Western Alliance sank 11% after accusing a borrower of fraud. The losses triggered a domino effect across small-cap banks. “The market is just really skittish about credit-related losses,” said Jed Ellerbroek, portfolio manager at Argent Capital Management. “The market is not very happy about [the regional banks’ comments], so most small-cap financials, banks are down today.”
Things got uglier after two auto-linked companies, First Brands and Tricolor Holdings, filed for bankruptcy this week. Their collapse pushed fresh fear into the banking space. Jamie Dimon, CEO of JPMorgan, said on the bank’s earnings call earlier this week. “When you see one cockroach, there are probably more.”
Meanwhile, Jefferies, which has exposure to First Brands, lost 10% Thursday, making its monthly drop 25%. Bankers and analysts alike are now staring hard at the private credit market, especially where transparency is lacking.
Trump’s tariff threats and rare earth tensions spook investors
Trade chaos helped add gasoline to the gold rally. President Donald Trump, back in the White House, made it clear last week that he wants a 100% tariff slapped on all Chinese imports. This was in response to China’s new export controls on rare earth minerals, a critical group of materials needed for everything from smartphones to fighter jets.
There was some hope earlier in the week that the situation might de-escalate, but that didn’t last long. On Tuesday, Trump took it further, threatening to ban cooking oil imports from China. That headline alone hit Wall Street hard, with traders dumping risk assets again and retreating to safe plays like gold.
The Cboe Volatility Index (VIX) spiked to its highest since May, signaling how edgy markets have become. Meanwhile, bond yields slumped, with the 10-year Treasury yield dropping below 4%, and the U.S. dollar index slid nearly 0.5%.
“The Trump administration desires to influence and control a lot more things than past administrations have … so they’re constantly jolting the market in unexpected ways,” Jed Ellerbroek, portfolio manager at Argent Capital Management, said. “That’s going to continue, and investors just have to kind of accept that as a new fact of life and be on their toes.”
Want your project in front of crypto’s top minds? Feature it in our next industry report, where data meets impact.
