Global equities surged higher on Tuesday while gold prices fell over 1%, as a ceasefire in the Middle East reshaped investor portfolios. The end of the 12-day conflict between Israel and Iran significantly reduced geopolitical risk, leading to a decrease in demand for safe-haven assets.
Spot gold dropped 1.4% to $3,319.84 an ounce, its lowest level in almost two weeks. U.S. gold futures also experienced a notable decline, slipping 1.7% to $3,335.50. This immediate market reaction underscores gold’s inverse relationship with broader market confidence.
Analysts like Ilya Spivak pointed to the exit of “geopolitical risk” from the market as a key driver. The ceasefire, publicly acknowledged by President Trump and Prime Minister Netanyahu, injected a sense of calm into the international arena.
The positive news also pushed oil prices to a two-week low as concerns over supply disruptions eased. Investors are now keenly anticipating Fed Chair Jerome Powell’s testimony, which could offer vital clues about the future direction of interest rates, a key factor for gold’s performance.