Gold soared to unprecedented levels on Thursday, breaking through the $4,300 per ounce barrier for the first time and sending the precious metal’s total market capitalization to $30 trillion, according to figures from CNBC. Spot gold climbed as high as $4,312, while U.S. December futures reached $4,328.70, both establishing new all-time highs.
The rally was spurred by intensifying U.S.-China hostilities and rising market conviction that the Federal Reserve may lower interest rates before month’s end. With risks mounting from geopolitical flashpoints and turbulent equities, investors pivoted in large numbers to gold, viewing it once again as a safe haven, amid widespread uncertainty.
Bank of America earlier this week raised its outlook on the yellow metal, issuing a 2026 target of $5,000 per ounce and forecasting an average price next year of $4,400. The lender also increased its view on silver, projecting prices to reach $65, with an average of $56.25. For gold to climb to $6,000, Bank of America says investor demand would need to jump 28% from its current pace.
While gold enjoyed capital inflows, equity markets endured steep losses. The Dow Jones Industrial Average declined by 301.07 points or 0.65%, to finish at 45,952.24. Meanwhile, the S&P 500 dropped 0.63% to close at 6,629.07—erasing gains set during earlier trading—while the tech-heavy Nasdaq Composite settled 0.47% lower at 22,562.54. Financial shares were particularly battered, with the banking sector under heavy pressure.
Trade frictions also added fuel to gold’s ascent. President Donald Trump, now back in the Oval Office, announced last week his intention to impose a 100% tariff on all imports from China following Beijing’s decision to restrict rare earth mineral exports—compounds vital to various high-tech industries.
Hopes for a reduction in trade tensions faded quickly, with Trump escalating threats on Tuesday by vowing to block cooking oil imports from China. That development sparked another exodus from risk assets and contributed to gold’s surge.
The Cboe Volatility Index (VIX) jumped to its highest since May, reflecting increased market anxiety. Meanwhile, the 10-year U.S. Treasury yield dipped below 4% as bond prices rose, and the dollar index weakened by nearly 0.5%.
The Trump administration is seeking far broader influence over economic and market matters than its predecessors, leading to regular and unpredictable jolts for investors, according to Jed Ellerbroek, portfolio manager at Argent Capital Management. Investors will have to adapt to this new reality and always be on a lookout.
