Microsoft and Meta’s trajectory began on the 29th and shifted to the beginning of what is potentially a short- to mid-term trend. Silver and gold’s trajectory downwards began on the 30th with a 10% correction for gold and a staggering 29% correction for silver relative to the 29th. .

Source: Leverage Shares analysis

Two separate yet somewhat interrelated events led to the shifting in favour among these disparate instruments.AI’s “Show Me the Money” Moment

An interesting moment occurred during Microsoft’s earnings call when the closely watched growth metrics for AI-relevant Azure and other cloud services revenue came in below consensus estimates at 39% while its More Personal Computing segment (that includes Windows) also came in quite below consensus estimates at $14.3 billion. Reacting to this, Microsoft CFO Amy Hood argued that the cloud segment’s result could have been higher if it had allocated more datacentre infrastructure to customers rather than prioritizing its in-house projects like Microsoft 365 Copilot. “If I had taken the GPUs that just came online in Q1 and Q2 in terms of GPUs and allocated them all to Azure, the KPI would have been over 40”, she said. This was paired with a massive 66% surge in Capital Expenditure. Given Microsoft is spending billions on chips, investors considered this to be highly presumptive since electrical substations and datacentre permits won’t likely be ready for a number of quarters.

On the other hand, Meta Platforms highlighted clearly how AI integration has been driving improvements across all layers of marketing and customer engagement. During the earning call, Meta CFO Susan Li stated, “In Q4, we doubled the number of GPUs we use to train our GEM model for ads ranking. We also adopted a new sequence learning model architecture, which is capable of using longer sequences of user behaviour and processing much richer information about each piece of content. The GEM and sequence learning improvements together drove a 3.5% lift in ad clicks on Facebook, and a more than 1% gain in conversions on Instagram in Q4.” The Meta AI business assistant also saw a new model rollout in Q4 2025 that drove a 24% increase in incremental conversions versus their standard attribution model. She added that the new AI-enabled product has already achieved a multi-billion dollar annual run rate just seven months since launching. Meta provided guidance that Full Year 2026 total expenses will likely be in the $162 billion-$169 billion range, of which the majority will be on infrastructure: third-party cloud spend, higher depreciation, and higher infrastructure operating expenses.

The differentiator between the response to both companies’ stock values was that investors valued investments into immediate, profitable customer demand over choosing speculative R&D. Another company that met the same fate as Microsoft was ServiceNow, which dropped 11.6% on January 29 despite reporting stronger-than-expected profits. Many investors chose to sell off the stock since the company continued to be opaque on the timeline for AI investments to translate into proportional revenue growth.

On the 29th, silver showed a weak 0.03% drop relative to the previous day in a move largely seen as being related to concerns over datacentre builds and the feasibility of imputing prices on silver without seeing buildout approval, concrete power commitment or utilization.

Of the two precious metals, silver is seen to be indispensable as a conductor in high-performance electronics as every new generation of AI server clusters requires higher-reliability contacts and power electronics. If servers have to run at high loads for decades, gold continues to be the standard for corrosion-resistant bonding wires and contacts in AI datacentres.

On the 29th, however, gold continued with its rise and added another 0.27% in value over the previous day’s level. What changed for both metals was the Trump administration’s surprising choice made for the next chair of the Federal Reserve (after current Chair Jerome Powell’s term ends in May) on the 30th of January. The Hawk in the Fed?

The Trump administration’s nomination of Kevin Warsh as the next Fed Chair was something of a decision made from left field. During his tenure from 2006 to 2011, Warsh became well-known as an “inflation hawk” as a long-term and frequent advocate in favour of quicker rate hikes and keeping rates “higher for longer” in order to aggressively combat inflation – a core duty of the Reserve. This stands at odds with the Trump administration’s stated preference for cutting rates to as low as 1% as soon as possible. Current Fed Chair Powell had long resisted this, leading to months of Trump calling him a “numbskull,” a “moron” and a “jerk” for not lowering interest rates more quickly.

The choice of Warsh as a nominee, given his hawkishness, might have been a glaring contradiction were it not for his curious messaging in recent times. Warsh has recently argued that the Fed has been “backward-looking” and too slow to cut rates. Thus, he would very likely favour delivering at minimum the two 25-basis-point cuts for 2026 indicated in the December 2025 Fed economic projections that the markets had already factored in.

Over the past 15 years, Warsh has repeatedly written and spoken extensively over his raised concerns about the size and composition of the Fed’s large balance sheet. This comes amidst the Fed once again growing its balance sheet through reserve management purchases of T-bills after having ended its “Quantitative Tightening” (QT) program in December 2025 that was brought into place to reduce its balance sheet in December 2025. Warsh has also argued for a new “Treasury–Fed accord” that could provide over time a framework for the Fed working in tandem with the Treasury – which could bring with some consequences for the future of housing agencies Fannie Mae and Freddie Mac – to shrink the size of its balance sheet.

Herein, the contradiction of Warsh’s selection despite his hawkishness on rates and the Fed’s role runs into another contradiction in Warsh’s recent statements: if the Fed were to shrink the balance sheet by offloading its T-bills into the market, this could tighten financial conditions. Simultaneously, he is also expressing support for lower interest rates to boost the economy. However, lower rates make loans cheaper while increasing consumption and investment, which can lead to demand-pull inflation. Simultaneously, it weakens the U.S. dollar, makes imports more expensive and adds to inflationary pressure.What All of This Boils Down To

Warsh’s selection as the Fed instantaneously broke the “dollar debasement” narrative that had been fuelling gold’s rally and lent handily to the rise of silver as it ran under the dual tailwind of AI spending as well as a precious rally. However, the market should ideally be wary of which version of Warsh they will receive as the Fed Chair: the hawk from almost two decades ago or the dove from the past few months.

Heavy speculative demand in precious metals from Chinese retail investors concerned over shrinking market breadth within their domestic bourses had pushed the Shanghai Futures Exchange to its limits, with both gold and silver’s Relative Strength Index (RSI) going past 90 until the 30th. A correction was inevitable. When Microsoft’s stock crashed on the 30th, it forced hedge funds to sell their “winners” (gold and silver) to cover margins, creating a short-term correlation between tech and metals. Adding news of Warsh’s nomination lent to the reason for the market to end the parabolic rally seen in the metals.

The bulk of institutional outlook have been fairly positive on the crash despite being fundamentally bullish on gold. The consensus outlook on the crash was that it was as a “healthy reset” of speculative excess that has taken on the form of speculative, highly leveraged trading positions. Chinese retail investors, in particular, took the hit on the unwinding of leveraged positions in both gold and silver quite hard.

The structural and fundamental institutional bullishness on both gold and silver steps from the inescapable reality of shifting geopolitics: whether a Warsh-led Fed cuts rates or not, it is clear that central banks would likely continue to de-dollarize and pursue reserve diversification – a substantial portion of which would include buying precious metals.

Meanwhile, the ferocious downturn among investors that demands tangible economic results from AI investments as opposed to being hyped on just ever-increasing dollar investments in AI is a potential gamechanger that could shake up the “AI Tech” sector. Resonations can be expected across the board in the earnings season yet to unfold and future quarters as well.