Precious metals have regained much of the value that was lost earlier in the week thanks to fresh geopolitical tensions as well as bargain-hunting by investors. Early reports are indicating that yet another Malaysia Airlines flight crashed out of the sky, this time over Ukraine. With little else on the slate for today, it is likely that investors will continue to mull over every last detail from this developing situation in Eastern Europe.
Malaysia Airlines Boeing 777 Reportedly Shot Out of Sky
Precious metals spot values were climbing forward shortly after US markets opened today, but things began picking up shortly after reports from Eastern Europe began hitting the presses. As of now, all we know is that a Malaysia Airlines flight from Amsterdam to Kuala Lumpur crash-landed in Eastern Ukraine, killing all 295 people on board.
Early speculation and accusations hold that the plane was shot out of the sky by a missile, but these accusations have yet to be confirmed by multiple sources. While the likely suspects would be pro-Russian separatists living in Ukraine, many people believe shooting a plane out of the sky from 30,000 feet away would be something these rebel groups are incapable of doing. What’s more, rebel leaders have already spoken out, claiming that they are not the ones who caused the plane to crash.
Through all this uncertainty, precious metals spot values have gained a lot of value. If it turns out that Russia or pro-Russian rebels were behind this seemingly random attack, tensions throughout Ukraine have a very good chance of escalating over the forthcoming days. With this in mind, investors the world over are seeking to rid themselves of riskier assets and once more cling to the safety offered by precious metals such as gold, platinum, silver, and palladium.
As you could have probably guessed, today’s increased tensions worked to hurt US equities considerably. As of midday, all major US stock indexes were in the red and only continuing to pile on the losses. Prior to this Malaysia Airlines incident, risk-appetite was on the rise due to the growing perception that the Fed will raise interest rates in the United States sooner than originally expected. While such may still be the case, risk-aversion has quickly taken over and is driving the spot values of precious metals forward. As we head into the final day of the week tomorrow, it will be interesting to see what all the market can find out about this downed plane in Ukraine. While most people are hoping that this crash was caused by nothing more than a inopportune malfunction, early signs are pointing towards it being an act of aggression by one of three potential groups.