Silver Nears Largest Two-Day Drop in Decades
Silver futures tumbled, heading for the biggest two-day drop in 28 years, on investor sales to cover losses from the rout in equities and raw materials.
More than $3.4 trillion has been erased from equity values this week, sending global stocks into a bear market, as the Federal Reserve’s U.S. stimulus plan and a pledge by Group of 20 nations fails to ease concern that the global economy is on the brink of a recession. The Thomson Reuters/Jefferies CRB Index of 19 raw materials fell to the lowest since November.
“We’re in a ‘risk-off’ mentality,” Bill O’Neill, a co- founder of Logic Advisors in Upper Saddle River, New Jersey, said in a telephone interview. “Some of it certainly is a case of sell the winning assets to meet the margin calls for the losing assets. We’re seeing massive selling across the spectrum in commodities.”
Silver futures for December delivery fell $4.273, or 12 percent, to $32.305 an ounce at 12:04 p.m. on the Comex in New York. A close at that price would mark a two-day drop of 20 percent, the most since February 1983.
Before yesterday, silver jumped 31 percent this year as Europe’s debt crisis boosted the appeal of the metal as a haven.
To contact the reporter on this story: Elizabeth Campbell in Chicago at firstname.lastname@example.org
To contact the editor responsible for this story: Steve Stroth at email@example.com