Gold prices slump against equities rebound
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Xinhua, September 8, 2011
Gold futures on the COMEX Division of the New York Mercantile Exchange lost more than 55 dollars on Wednesday, the second straight drop in a row, as the rebound in global stock markets eroded demands for the precious metal.
The most active gold contract for December delivery lost 55.7 U. S. dollars, or three percent, to 1,817.6 dollars per ounce. That was gold's largest one-day drop in two weeks, and the lowest settlement in a week and half.
Market analysts said that the stock markets around the world posted strong gains, which dampened appetites for gold and squeezed money out of the precious metal market. Asian and European equities Wednesday posted strong gains, while U.S. stocks ended a three-day drop and closed higher.
"It is my belief that many traders will continued to liquidate long positions as well as play the short side in anticipation of President Obama's job address to the nation," said Mike Daley, a senior gold analyst with PFGBEST Group.
However, some traders noted that the short-term correction would not last for long, as there was always pent-up buying on the market and the bullish themes for gold are still around.
Silver for December delivery further shed 23.7 U.S. cents, or 0. 57 percent, to 41.631 dollars per ounce. Platinum for October delivery also lost 29.5 dollars, or 1.6 percent, to 1828.7 dollars per ounce.
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