Monday morning did not open very well for the stock market. The Dow Jones International Average is having its worst day since December 2008 as it crashed around 2,000 points. S&P 500 opened already down 7%, halting trade for 15 minutes as selling pressure triggered a circuit breaker. This is also the S&P’s third-worst open ever. Amid this crisis surrounding global panic over the impact of the coronavirus (COVID-19) and the oil market, the gold price has soared overnight, breaking past $1,700. 

What is going on with the oil market?

Analysts say that this significant drop for the stock market is because of not only fears about the coronavirus, but also from the oil market. Since last night, the oil price has dropped as Russia and Saudi Arabia entered a price war. After Russia refused to cut its oil production per day despite the proposal by OPEC, Saudi Arabia responded by slashing its crude oil prices more than 20%. Oil prices have not dropped this significantly since 1991. Saudi Arabia also might be trying to drop this price even more. Furthermore, the Energy Select Sector SPDR Fund that tracks the energy sector dropped an estimated 15%. All this contributed to the Dow Jones opening down an estimated 7%.

Edward Bell, a commodities analyst at Emirates NBD, wrote on Sunday: “The outcome is an astonishing reversal of what appeared to be a pending production cut to compensate for the decline in demand caused by the COVID-19 (coronavirus) outbreak.” 

What does this mean for the gold price?

gold price chart from march 2 to march 9 2020

Despite fluctuations, the gold price pushed to a high of around $1,700 overnight. This has not happened since 2012. They might be off their highs at the start of the North American trading session on Monday morning, but it is predicted they will hold positive gains. On the morning of March 9, gold was trading at about $1,679. This may only increase as coronavirus concerns continue to send investors into panic. According to John Hopkins University, there are more than 111,300 cases of coronavirus worldwide, with almost 4,000 deaths globally. However, in the US, there are about 500 cases. 22 of these cases resulted in death. The coronavirus is pushing governments around the globe to shut down schools and lockdown certain areas of countries to attempt to cut down the spread. All this convinces investors to continue putting their money into safe-haven assets as the stock market continues to decline.

Investors are most worried about the disruption of global supply chains possibly sending the world into recession. Thus, they are selling their stocks and shift their focus to precious metals. 

So What’s Next?

Coronavirus has areas of countries, like Italy and China, locked down in quarantine. This affects economies globally, pushing Russia and Saudi Arabia to try to keep their heads above water with the oil market. 

The stock market already dropped around 7% this morning. If the stock market drops to 13%, there will be a second 15-minute recess as circuit breakers for equity indexes are triggered. Should it drop by 20%, the stock market will close for the day and resume tomorrow. 

As panic surges from the weekend globally, the gold price has soared to a record 7-year high. Now might be a good time to consider your precious metals portfolio. Look no further than Bullion Exchanges.

SELL TO US!

With the current market fluctuations, now could be a good time to sell your gold bullion. If you’re looking for a reputable dealer with top ratings and a great reputation in the industry, check us out! We buy a variety of precious metals, in addition to diamonds and scrap metal. Our team is ready to assist you with selling your precious metals to Bullion Exchanges, your precious metals dealer in midtown Manhattan.

  • Call us – at (800) 852-6884, or request a callback.
  • Lock In Price – Prices are locked in with your price quote and a confirmation email.
  • Ship Us Your Items – Follow the shipping instructions listed in the confirmation email.
  • Get Paid – Once your shipment is received and verified, we will release your payment.

CALL 1.800.852.6884 FOR MORE INFORMATION OR TO START SELLING!

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