Precious metals spot values are reeling Friday morning due to profit-taking in the wake of yesterday’s large gains. Despite risk-aversion making its way back into the marketplace, the spot values of metals have declined considerably this morning. With little else on today’s slate, I expect the investing world to continue analyzing and speculating about the tragic Malaysia Airlines crash we witnessed not even 24 hours ago.

Geopolitical Tensions On the Rise

Despite this week being a typical summer trading session, there has been a lot of action and talking points for investors to mull over. The latest of these talking points came yesterday in the form of yet another Malaysia Airlines passenger plane falling from the sky.

Yesterday afternoon, it was reported that a Malaysia Airlines plane carrying 295 people from Amsterdam to Kuala Lumpur was shot down over Eastern Ukraine, not even 6 hours into its flight. Early reports held that the plane was shot down by a missile launched from the ground, but the world hoped such wasn’t the case. Only a few hours later, however, it was confirmed that Malaysia Airlines flight MH-17 was shot down by missiles, but it was still unclear as to whose missiles they were and who exactly shot them. As the investigation into what actually happened continues, investors are slowly but surely exhibiting more of a risk-averse attitude. After all, tensions across Eastern Europe are already high, this situation is shaping up to simply make matters worse. With the increased risk-aversion making its way to the market, investors are flocking more readily to safe-haven precious metals.

Also boosting the growing notion of risk-aversion is the threat of an all-out ground invasion of Gaza by Israeli troops and tank units. After Israel and Hamas have spent the better part of the last two weeks ceaselessly launching missiles at one another, Benjamin Natanyahu and his colleagues have decided that a ground invasion may be the only real way of stopping the violence once and for all. With tank units at the ready, this weekend is shaping up to be an exciting one all over the world, and for all the wrong reasons. While metals may be suffering from some downward pressure at present, I think things will change by this afternoon and that risk-aversion and safe-haven demand will pull spot values right back up.

As a result of all the violence happening in the last few days, stock indexes from around the world have been trading downward. US equity markets in particular were hit fairly hard yesterday, and are already beginning to falter during the early morning hours of Friday. Now, investors and market analysts alike are beginning to speculate that this may finally be the end of the upward trend of US equities. I suppose only time will tell if equity markets in the US will continue to edge downward, but early indications are pointing to yes. This weekend is shaping up to be an interesting one, as the world will keep its eyes plastered to the TV in order to find out more about the number of unfolding events in Ukraine, Israel, Iraq, and elsewhere.