Global financial markets experienced significant turbulence as former President Donald Trump’s unexpected trade policy announcement triggered a flight to safe-haven assets. Gold prices surged to an unprecedented $4,690.59 per ounce, while silver reached $94.12, marking historic highs in precious metal trading.
The Australian sharemarket snapped its five-day winning streak despite the commodity rally, with the benchmark ASX 200 declining 29.40 points (0.33%) to close at 8,874.50. The broader All Ordinaries index similarly fell 31.80 points (0.34%) to 9,194.90. Market analysts attributed the divergence to sector-specific performances, where strengthening commodity prices were offset by substantial declines in technology, consumer discretionary, and financial stocks.
Trump’s controversial proposal involved imposing 10% export tariffs on eight countries that opposed the United States’ attempted acquisition of Greenland, a largely autonomous Danish territory. This announcement reignited fears of potential trade conflicts between Europe and the United States, prompting investors to seek refuge in traditional safe-haven assets.
Gold producers emerged as clear market winners, with Northern Star Resources jumping 3.17% to $27.68, Evolution Mining climbing 3.13% to $13.53, and Newmont Corporation adding 1.41% to $171.64. According to eToro market analyst Zavier Wong, “The outlook for precious metals remains positive, particularly for gold and silver. Structural forces are doing much of the heavy lifting, including sustained central bank buying, rising government debt levels and a world that looks increasingly fragmented geopolitically.”
Technology stocks suffered significant losses, with WiseTech Global slumping 4.40% to $64.07, Xero declining 2.64% to $100.89, and TechnologyOne falling 1.43% to $13.15. Banking shares also retreated, with Commonwealth Bank sliding 0.67% to $153.25, Westpac falling 0.56% to $38.97, NAB slumping 1.05% to $42.22, and ANZ slipping 0.40% to $37.37.
In corporate developments, A2 Milk shares plummeted 10.64% to $8.40 and entered a trading halt despite no negative financial disclosures. Market speculation suggested investor concerns might be linked to Chinese government data showing declining birth rates. Conversely, City Chic Collective shares jumped 3.57% to $0.14 after reporting $69.2 million in sales revenue for the 26 weeks to December 28. Treasury Wine Estate shares continued their upward trajectory, gaining 0.73% to $5.53 following European billionaire Olivier Goudet increasing his stake to 6.13% of the business.
The Australian dollar edged higher to 66.96 US cents amid the mixed market performance, reflecting the complex interplay between commodity strength and broader market uncertainties.