An exchange traded fund (ETF) tracking silver was down more than 5% in preopen trading Monday after the U.S. announced the death of al-Qaeda leader Osama bin Laden in Pakistan and Comex operator CME Group raised margin requirements for silver futures.
The iShares Silver Trust (NYSEArca: SLV) fell 5.5% at last check before the bell.
“News about Osama and the 13% margin increase — the second in a week — hit the market at the worst possible time,” said Ole Hansen, senior manager at Saxo Bank, according to Reuters. “We are seeing volatility at an unprecedented level here and the fight between the bulls and bears has entered an interesting stage.”
The silver ETF gained 71% for the three months ended April 28.
An ETF for gold, SPDR Gold Shares (NYSEArca: GLD), was down fractionally in premarket trade.
Full disclosure: Tom Lydon’s clients own SLV and GLD.
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