Silver and Gold ETFs Stage Dramatic Recovery After Volatile Week
Gold and silver exchange traded funds (ETFs) experienced a powerful rebound on February 9, mirroring the sharp recovery in precious metal prices following a period of intense volatility that had unsettled investors. This significant bounce followed last week's steep correction, which was primarily driven by speculative excess, margin-related liquidations, and a strengthening US dollar.
Silver Leads the Charge with Double-Digit Gains
Monday's recovery was decisively led by silver, which outperformed gold in both spot markets and ETF gains. A softer US dollar, strategic dip-buying interest, and supportive global cues helped stabilize market sentiment, even as traders maintained caution regarding near-term price swings. While gold attracted steady inflows as a traditional hedge, silver's higher beta resulted in outsized ETF gains, reflecting renewed risk appetite among traders willing to bet on a sustained rebound.
Silver ETFs dominated the trading session, clocking impressive double-digit gains across the board:
- Axis Silver ETF rallied nearly 12% to reach an intraday high of ₹264.69, making it the top performer among all precious metal funds.
- UTI Silver ETF and Groww Silver ETF followed closely behind, each rising approximately 11%.
- Nippon India Silver ETF, HDFC Silver ETF, and Tata Silver ETF all advanced more than 10% each, demonstrating broad-based buying interest.
- Zerodha Silver ETF, SBI Silver ETF, Kotak Silver ETF, and ICICI Prudential Silver ETF each gained close to 8% during the session.
Gold ETFs Participate with Modest but Steady Gains
Gold ETFs also participated in the market rebound, though their gains were comparatively more modest than their silver counterparts. Angel One Gold ETF, LIC MF Gold ETF, and Zerodha Gold ETF each jumped about 5%. Other prominent funds, including Kotak Gold ETF, Motilal Oswal Gold ETF, Nippon India Gold ETF, SBI Gold ETF, and Mirae Asset Gold ETF, recorded gains of around 3%.
Precious Metal Prices Rally in Early Trading
Silver and gold prices rallied significantly in early trade on Monday as investors stepped in to buy on dips, supported by a softer US dollar and improving global risk sentiment. Silver led this recovery, with MCX silver rising nearly 6% to approximately ₹74,000 per kilogram, after experiencing sharp selling pressure throughout the previous week.
In the international market, spot silver jumped about 2.5%, extending gains after a nearly 10% rebound in the previous session. Gold prices also moved higher, with MCX gold adding around 2% to trade near ₹63,000 per 10 grams. Meanwhile, spot gold rose up to 1.7% in early trade to hover above the $2,050-per-ounce mark before paring some gains.
Key Drivers Behind the Market Rebound
The primary driver behind this rebound was weakness in the US dollar, which slipped to its lowest level since February 4. A weaker greenback typically supports bullion prices by making dollar-priced commodities cheaper for overseas buyers, thereby lifting overall demand sentiment.
Bullion sentiment received additional support from political developments in Japan following a landslide election victory for Prime Minister Sanae Takaichi. This outcome reinforced expectations of looser fiscal policy and sustained pressure on the yen—conditions that are traditionally supportive for gold and other precious metals as alternative stores of value.
Expert Analysis and Future Outlook for Precious Metals
Silver continued to exhibit higher volatility compared to gold, with price swings amplified by speculative positioning and thinner over-the-counter liquidity. Despite the recent rebound, the white metal remains well below its record peak, having shed over a third of its value during the recent correction.
NS Ramaswamy, Head of Commodity & CRM at Ventura, provided valuable insights: "Longer-term bullish momentum remains intact, driven by structural diversification trends and sustained central bank buying." He highlighted that central banks purchased approximately 230 tonnes of gold in the fourth quarter of 2025, with total annual buying expected to remain above 800 tonnes in 2026.
Ramaswamy added: "Silver is likely to remain volatile in the near term, with a projected range of $72 to $78. A decisive breakout above $80 will signal a stronger recovery." He noted that the sharp selloff in silver was largely triggered by higher margin requirements, which forced traders to liquidate positions and accelerated the price drop.
Looking forward, market participants are closely tracking upcoming US macroeconomic data for crucial cues on the Federal Reserve's policy direction. The January jobs report and fresh inflation readings later this week are expected to play a pivotal role in shaping near-term bullion trends.
Disclaimer: The views and recommendations mentioned above are those of individual analysts or broking companies, and not of Bharat Horizon. We strongly advise investors to consult with certified experts before making any investment decisions.
