By: Daniela Hathorn Senior Market Analyst at Capital.com
Markets have seen a busy and volatile 24 hours, with price action increasingly resembling a classic correction environment rather than outright panic. Volatility has picked up across asset classes as investors head into the weekend with geopolitics firmly in focus, particularly amid growing expectations that the US could escalate its stance toward Iran. That backdrop has encouraged a degree of portfolio de-risking, reinforcing the risk-averse tone seen late in the week.
In commodities, the move has been most visible in precious metals. Gold and silver had been trading in an increasingly speculative environment, with gold up nearly 20% and silver more than 30% over the past ten days. Against that backdrop, the near-10% pullback in gold overnight, while sharp, looks consistent with a long-overdue correction after a period of uninterrupted upside. Importantly, this does not undermine the longer-term appeal of precious metals, which continue to benefit from central bank buying and their role as hedges against political and fiscal uncertainty. Rather, it reflects some concern that prices had moved too far, too fast, without a meaningful test of momentum.
Equities are also showing signs of caution as investors balance geopolitical risks with the heart of earnings season and still-elevated valuations. While results from major tech names such as Apple have been broadly solid, warnings around rising component costs and potential margin pressure have reignited questions about how sustainable current valuations really are. With heavy investment already sunk into AI projects whose returns lie further out, markets are increasingly debating whether expectations have run ahead of reality. Overall, the tone suggests consolidation and reassessment, rather than capitulation, as markets navigate a more fragile and uncertain environment.
Gold (XAU/USD) daily chart:
Past performance is not a reliable indicator of future results.
