Silver Extends Drop as Traders Brace for Wider Index Rebalancing

Silver fell for a second day with investors positioning for an annual rebalancing of commodity indexes that will see futures contracts worth billions of dollars sold in the next few days. Gold steadied, paring earlier losses.

The white metal fell as much as 5.5%, following a drop of almost 4% in the previous session. Passive tracking funds are selling precious metals futures from Thursday to match new weightings required by the indexes — a usually routine process that has taken on extra significance for gold and silver due to last year’s blistering rallies.