Silver miners slide as spot price drops on Iran tensions

Investing.com -- Spot silver tumbled 1.7% to $56.82 per ounce on Thursday as escalating U.S.-Iran hostilities stoked inflation fears and lifted rate-hike expectations, dragging silver mining equities sharply lower alongside the metal.

Hecla Mining (NYSE: HL), Coeur Mining (NYSE: CDE), Endeavour Silver (NYSE: EXK), and Silvercorp Metals (NYSE: SVM) all declined in Thursday's session, amplifying the metal's losses through their operating leverage to silver prices.

Scotiabank cut its price target on Hecla to $21 from $25, citing sustained pressure on silver, a notable downgrade given that Hecla derives roughly 73% of its Q1 2026 revenue from the metal. Coeur Mining has fallen more than 6% in recent sessions, a selloff made more significant by the company's all-in sustaining cost range of $15 to $16.25 per ounce — a margin that narrows considerably as silver approaches $57.

Thursday's drop is the latest chapter in a punishing selloff for silver. The metal has now fallen roughly 52% from its January 2026 all-time high of $121.62 per ounce, and the gold-silver ratio has climbed to approximately 69:1, a level that historically signals significant underperformance by silver relative to gold, according to goldsilver.com. Silver September futures had already hit their lowest level since December 9, 2025, when they opened at $57.95 on Tuesday, July 14, as Reuters reported that the Iran conflict was intensifying.

The macro driver is straightforward: U.S. strikes on Iran's coastal defenses and the reimposition of a naval blockade have pushed oil prices higher, feeding an inflation narrative that raises the cost of holding non-yielding assets like silver. Traders are currently pricing in approximately a 51% probability of a Federal Reserve rate hike in September, according to CME FedWatch data cited by Investing.com analysis — a direct headwind for the metal and the equities tied to it.

"Gold continues to be dictated by inflation and geopolitics. Continued U.S. strikes against Iran and disruptions in the Strait of Hormuz support oil prices and sustain inflationary risks," said Niko Tzabouras, senior market analyst at Tradu.com, which is owned by Jefferies. He added that while recent soft CPI and PPI prints had removed some urgency for Fed tightening and could offer a basis for bullion to eventually recover, "this inflation cooling may prove short-lived as oil prices rise again. Any de-escalation or restart of talks would be the best-case scenario for gold."

The weakness is not confined to U.S.-listed names. London's FTSE 100 precious metals miners sub-index declined 2.7% on Wednesday as the same Middle East-driven inflation narrative pressured gold and silver globally, Reuters reported. The broader U.S. metals and mining sector, tracked by the SPDR S&P Metals and Mining ETF, has shed nearly 25% in recent weeks, though Investing.com technical analysis has identified structural support near the 99.95 ETF low and a potential bull-flag pattern forming.

For miners, the pain is twofold. Revenue compresses as silver prices fall while costs remain relatively fixed, squeezing margins for producers already operating in a difficult environment. Coeur's $15 to $16.25 per-ounce all-in sustaining cost looks manageable at current prices, but the trajectory of silver matters as much as today's level, and that trajectory has been sharply lower since January.

The next meaningful catalyst for silver equities could come before Thursday's close. Dallas Fed President Lorie Logan and Fed Vice Chair Philip Jefferson are both scheduled to speak today, and any shift in their tone around the September rate decision could move market pricing on rate-hike odds in either direction, directly affecting the rate-sensitive metals complex. A more dovish signal than the market currently expects could provide relief for silver and the miners tracking it; a hawkish lean would likely extend the selloff. Investors in Hecla, Coeur, and their peers will be listening closely.

You May Also Be Interested In

• ServiceNow rallies after Q2 beat, lifts annual outlook on AI demand
• Traders face rare pre-Fed cliffhanger in Warsh’s ’no-guidance’ era
• Piper names top software stocks as AI token savings can go up to 75%