Morning brief: US holds off new China chip tariffs as Gold, Silver hit record highs

Global markets are navigating a complex mix of trade policy uncertainty, surging commodity prices, and resilient equity performance as the year draws to a close.

Washington signaled a pause — for now — in escalating trade measures against China’s semiconductor sector.

At the same time, precious metals rallied to historic highs on geopolitical tensions and expectations of easing US monetary policy.

Corporate dealmaking and upbeat Asian equity markets added to an already eventful global backdrop.

US holds off new chip tariffs on China

The United States accused China of unfair trade practices in the semiconductor sector but stopped short of imposing new tariffs, at least until mid-2027.

The Office of the US Trade Representative on Tuesday released findings from a yearlong Section 301 investigation into China’s chip industry, concluding that Beijing’s policies were “unreasonable” and harmful to US commerce.

Under the notice published in the Federal Register, tariffs on covered semiconductor products will remain at zero for the next 18 months.

Any new duties would take effect from June 23, 2027, with rates to be announced at least 30 days in advance.

The move preserves Washington’s ability to raise tariffs later, without disrupting current trade flows.

The decision follows a truce reached earlier this year between President Donald Trump and Chinese President Xi Jinping, aimed at easing tensions after a trade war that rattled global markets.

China pushed back against the US findings, warning that politicizing trade and technology issues would destabilize global supply chains and eventually backfire.

The probe focuses on so-called foundational or legacy chips made in China — components widely used in automobiles, airplanes, medical devices, and telecommunications equipment.

Potential future duties could apply to items such as diodes, transistors, raw silicon, and integrated circuits, but would not extend to finished products like smartphones or computers.

Gold price surge lifts precious metals

Gold climbed to a record above $4,500 an ounce, extending a powerful rally driven by geopolitical risk and expectations of further US interest-rate cuts next year.

Spot gold rose as much as 1% on Wednesday, building on three consecutive days of gains, as tensions surrounding Venezuela and US actions to block oil shipments boosted demand for safe-haven assets.

The metal has now gained more than 70% this year, its strongest annual performance since 1979.

Analysts point to sustained central-bank buying and steady inflows into gold-backed exchange-traded funds as key drivers.

Holdings in the SPDR Gold Trust, the world’s largest gold ETF, have risen by more than 20% this year.

Silver and platinum also surged to all-time highs.

Silver briefly traded above $70 an ounce for the first time, supported by speculative inflows and lingering supply disruptions, while platinum jumped beyond $2,300 an ounce amid tight supplies and elevated borrowing costs.

Both metals are on track for their best annual performances on record.

BP nears sale of Castrol stake to Stonepeak

BP Plc is close to an agreement to sell a majority stake in its Castrol lubricants business to investment firm Stonepeak Partners, according to a Wall Street Journal report citing people familiar with the matter.

The deal would value a 65% stake at around $6 billion and puts the entire division at a valuation of $10 billion, including debt.

The potential sale forms part of BP’s broader plan to divest $20 billion of assets by the end of 2027 to strengthen its balance sheet.

The transaction would come as Meg O’Neill prepares to take over as chief executive in April.

The sale comes after BP now looks to bolster its fossil fuel business after its attempt to go into renewable fuels backfired with the investors.

Asian markets extend year-end gains

Asian equities edged higher on Wednesday, capping a strong year fueled by artificial intelligence-driven optimism and robust US economic data.

MSCI’s broadest index of Asia-Pacific shares outside Japan rose about 0.3%, taking its annual gain to roughly 26%, the best performance since 2017.

Japan’s Nikkei fell 0.13% but is also up about 28% for the year, while South Korea’s market stood out with a surge of more than 70% in 2025.

Elsewhere, S&P 500 futures were down 0.12% amid thin year-end liquidity, after the S&P 500 closed at a record overnight.

Currency markets were quieter, with the yen extending gains on intervention risk and the dollar weakening against major peers.

Oil prices were steady but on track for a third consecutive annual decline.

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