ASX Declines as Gold, Silver Miners Fall; Banks Surge
The Australian sharemarket faced significant declines as gold and silver miners experienced sharp losses. This downturn followed a notable drop in prices for these precious metals over the weekend. As of February 2, 2026, the S&P/ASX 200 index was down 81.5 points, representing a 0.9% decrease, settling at 8787.6 by midday.
Market Overview
Six out of the eleven industry sectors saw declines. Precious metals were the hardest hit, with major mining companies struggling. The Australian dollar also fell, trading at US69.57¢ as the US dollar strengthened. This shift came in the wake of President Donald Trump nominating Kevin Warsh as the next chair of the Federal Reserve, which stirred investor sentiments.
Precious Metal Miners Plummet
- Northern Star: -7.9%
- Evolution Mining: -6.3%
- Newmont: -8.4%
- South32: -4.2% (silver)
The price of gold plummeted by 11.4%, closing at $US4745.10 per ounce on Saturday. This marked a drastic shift after it previously surged to over $US5600 last week. Silver also experienced a severe decline, falling 31.4%.
Analyst Insights
Kyle Rodda, a senior analyst at Capital.com, remarked on the volatility, stating, “The total collapse in precious metals prices shows that any market can become gripped by mania.” He emphasized that the sell-off is leading to broader market implications due to excessive leverage among investors.
Broader Market Impact
Other mining stocks, such as BHP and Rio Tinto, also faced losses. Financial stocks experienced mixed reactions, with Commonwealth Bank gaining 1% while National Australia Bank fell 0.5%. Energy stocks were not spared either, with Woodside Energy down 0.8% and Santos losing 2.2%.
Leadership Changes at Corporate Travel Management
In corporate news, Jamie Pherous, the founder and managing director of Corporate Travel Management, resigned amid allegations of over-charging government clients. This resignation comes as the company faces scrutiny following a halt in trading of its shares.
Impact of Federal Reserve Nomination
The market’s troubles were compounded by uncertainty surrounding Trump’s nomination of Warsh. Investors are speculating on potential changes to the Fed’s stance on interest rates. Warsh has historically supported lower rates, raising concerns about the Fed’s independence.
US Market Movements
On Wall Street, the market reflected similar sentiments. The S&P 500 fell by 0.4%, while the Dow Jones and Nasdaq composite also posted declines. Despite overall downturns, Tesla saw a 3.3% increase, buoyed by better than expected quarterly profit reports.
This landscape highlights the delicate balance between market performance and federal monetary policy, underscoring a critical period for investors and economic stakeholders alike.
