Spot gold and silver prices plummeted on Monday, driven by a surge in oil prices and firmer Treasury yields. The May ISM manufacturing index rose to 54.0, marking the strongest reading since May 2022, while new orders improved to 56.8 from 54.1.

The data mix reinforced the pressure on metals, as factory activity improves and construction continues to expand. However, input-cost uncertainty remains tied to oil, tariffs, and Middle East risk. Crude oil rallied after the weekend passed without a U.S.-Iran agreement to reopen the Strait of Hormuz, with reports of Iran pausing talks after Israeli attacks in Lebanon.

Despite the oil shock, U.S. equities closed higher, with technology and energy shares offsetting weakness tied to higher fuel costs. The S&P 500 rose 0.3% to a record close, while the Dow Jones Industrial Average gained 0.1%. The Nasdaq Composite advanced 0.4%, but the Russell 2000 slipped 0.5%.

Technically, spot gold bulls’ next upside price objective is to push prices back above $4,500 to $4,514 resistance zone, with a sustained move targeting $4,546.90 and then $4,550. Bears’ next near-term downside price objective is a break below $4,446.90, with deeper downside targets at $4,420 and then $4,400.

Spot silver bulls’ next upside price objective is to drive prices back above the $74.97 to $76.00 area, with a move above that zone targeting $76.42 and then $78.00. The next downside price objective for the bears is a break below $73.25, with deeper downside targets at $72.00 and then $70.00.

Across other markets, the clearest transmission is higher crude, pressure on fuel-sensitive equities, firmer yields, stronger energy shares, and renewed volatility in shipping-sensitive sectors. The U.S. dollar index is firmer, while the yield on the benchmark 10-year U.S. Treasury note is trading near the 4.5% area.

The key outside markets see Nymex WTI crude oil prices higher and settling around $92.16 a barrel, while Brent crude settled near $94.98. The current impact on gold is negative through higher oil, higher Treasury yields, and a firmer dollar, even though the conflict risk still supports defensive allocation at the margin.

The May ISM manufacturing index has marked a fifth straight month of expansion, with new orders improving to 56.8 from 54.1. April construction spending rose 0.4% to a $2.172 trillion seasonally adjusted annual rate, with private residential construction up 0.8% and public construction up 0.4%. These data points reinforce the pressure on metals, as factory activity improves and construction continues to expand.

However, input-cost uncertainty remains tied to oil, tariffs, and Middle East risk. The U.S.-Iran negotiations remained unresolved, with reports of Iran pausing talks after Israeli attacks in Lebanon. Crude oil prices surged on Monday, driven by concerns over the Strait of Hormuz and the potential for increased tensions.

Despite the uncertainty, U.S. equities closed higher, with technology and energy shares offsetting weakness tied to higher fuel costs. The S&P 500 rose 0.3% to a record close, while the Dow Jones Industrial Average gained 0.1%. The Nasdaq Composite advanced 0.4%, but the Russell 2000 slipped 0.5%

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