Investors are favouring safe haven assets over riskier investments as US President Donald Trump prepares to implement his wide-ranging tariffs and impacted countries gear up to respond.
The S&P/ASX 200 tumbled 109.2 points, or 1.37%, to 7,827.8 points as of 10.36am AEDT.
The index has dropped 0.74% over the past five trading sessions and is 0.31% lower over the past year.
All 11 sectors started the day in the red, with materials leading the bourse lower on a 1.35% retreat. Industrials slipped 0.34%, energy fell 0.17% and utilities was down 0.15%.
Lithium miner Pilbara Minerals (ASX:PLS) retreated 5.18% to $1.74, while aluminium producer Alcoa (ASX:AAI) fell 4.13% to $48.52.
ANZ Economist Aaron Luk says the imminent arrival of reciprocal tariffs continues to boost gold’s appeal.
“The precious metal ended the week up 2%, touching a record high of US$3,085 ($4,912) per ounce as investors continue to seek haven assets,” he says.
“Europe and Canada threatened to join forces to combat the US tariffs, a scenario US President Donald Trump warned would result in harsher penalties.”
Gold advanced further on Monday (31 March) morning AEDT to just shy of US$3,090 an ounce.
“Mounting fears about the potential impact of an escalating trade war overshadowed positive economic data in the US,” Luk says.
“The US economy expanded at a quicker pace in the fourth quarter than previously estimated.”
Silver is also riding gold’s tailwinds, closing last week at its highest level since 2012, according to Luk.
“Its relative undervaluation compared to gold will likely attract further investor interest, as the fundamental backdrop remains supportive,” he notes.
Silver was fetching over US$34 an ounce on Monday morning AEDT.
The S&P/ASX200 is Australia’s leading share market index and contains the top 200 ASX-listed companies in terms of market capitalisation, and accounts for about 80% of the country’s equity market. The index is designed to measure the performance of the 200 largest index-eligible stocks listed on the ASX by float-adjusted market capitalisation.
It is recognised as the institutional investable benchmark in the country.
Write to Angela East at Mining.com.au
Images: ASX & Stock
