(New throughout, updates prices, market activity and comments)
* Dollar retreats from a more than one-week high
* Interactive graphic tracking global spread of coronavirus: https://tmsnrt.rs/3mvcUoa
By Shreyansi Singh
Jan 28 (Reuters) - Silver prices rose around 7% on Thursday as the dollar weakened, making the metal cheaper for buyers outside the United States.
Some traders were also moving to cover short positions as rumours rippled through the market about a GameStop-style squeeze driven by retail investors.
Calls to drive silver prices higher by buying shares in silver miners and exchange traded funds (ETF) were circulating on social media such as Reddit and Twitter.
Trading of Blackrock (NYSE: BLK )'s BLK.N iShares Silver Trust (NYSE: SLV )< SLV> surged, while shares in Canadian miner First Majestic Silver FR.TO AG.N leaped more than 30%. prices XAG= shot as high as $26.95 an ounce after U.S. markets opened, up almost 7%, before slipping back to $25.93 an ounce by 01:43 p.m. EST (1843 GMT).
"After watching GameStop (NYSE: GME ) and other shorts getting blasted, rumours that silver could be targeted has traders preemptively covering shorts just in case,” said Tai Wong, a trader at investment bank BMO in New York.
Other analysts said the social media action was not impacting prices.
The silver market is much larger and more liquid than shares of companies such as GameStop GME.N , whose shares have ricocheted madly this week. Because of this, efforts of retail investors will have little effect, predicted Ross Norman, an independent analyst.
The dollar also fell as U.S. markets opened, giving a boost to dollar-priced precious metals. FRX/ .DXY
Data showed the U.S. economy contracted in 2020 at its sharpest pace since World War Two, encouraging investment in assets such as silver and gold, traditionally seen as safe stores of wealth.
Spot gold XAU= spiked as much as 1.1% higher as U.S. trading began, before slipping to $1,840.81 an ounce, near their lowest since Jan. 18.
U.S. gold futures GCv1 settled 0.4% lower to $1,837.90.
Add Chart to Comment
We encourage you to use comments to engage with users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind:
- Enrich the conversation
- Stay focused and on track. Only post material that’s relevant to the topic being discussed.
- Be respectful. Even negative opinions can be framed positively and diplomatically.
- Use standard writing style. Include punctuation and upper and lower cases.
- NOTE: Spam and/or promotional messages and links within a comment will be removed
- Avoid profanity, slander or personal attacks directed at an author or another user.
- Don’t Monopolize the Conversation. We appreciate passion and conviction, but we also believe strongly in giving everyone a chance to air their thoughts. Therefore, in addition to civil interaction, we expect commenters to offer their opinions succinctly and thoughtfully, but not so repeatedly that others are annoyed or offended. If we receive complaints about individuals who take over a thread or forum, we reserve the right to ban them from the site, without recourse.
- Only English comments will be allowed.
Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at Investing.com’s discretion.