MW: Gold little changed as stocks rise, dollar weakens
By Moming Zhou, MarketWatch
NEW YORK (MarketWatch) -- Gold futures swung between gains and losses early Tuesday as rising global stock markets and the falling U.S. dollar boosted sentiment but fund liquidation limited the precious metal's gains.
Gold for December delivery was last down $2.40, or 0.3%, at $740.50 an ounce on the Comex division of the New York Mercantile Exchange. It rose $13.20 to $756.10 earlier in electronic trading.
Gold rose as equity markets in Asia and Europe moved higher and the dollar lost ground, said James Moore, an analyst at TheBullionDesk.com. However, "with volatility still at record levels and hedge funds still seeing large scale redemptions, the metal remains at risk to a bout of selling."
Hong Kong stocks spiked more than 14% Tuesday, while Japanese markets also recorded a muscular rise. European shares moved broadly higher, and U.S. stocks also rose sharply at the open. See Market Snapshot.
In currencies, the dollar was trading lower against the euro and the British pound. The Federal Open Market Committee, the Federal Reserve's rate-setting arm, on Tuesday began the first day of a two-day meeting in which an interest-rate cut is seen as nearly certain.
A weakening greenback tends to increase gold's appeal as an alternative investment.
Gold futures came under heavy selling pressures in recent trading, with the benchmark contract falling in 10 out of the past 13 sessions since it closed above $900 on Oct. 8. It lost 7.3% last week.
Trading in this week is "set to remain volatile and could prove pivotal to gold's medium-term direction," said Moore.
In exchange-traded funds, gold in the SPDR Gold Trust , the largest gold ETF, stood at 749.21 tons Monday, up 2.15 tons from Friday, according to the latest data from the fund. This is the first rise since gold held by the fund hit a record high of 770.64 tons on Oct. 10.
"The modest increase in ETF holdings is encouraging and again suggests the metal is back in an area of more sustainable support from longer-term investors," said Moore.
In spot trading, the London gold-fixing price -- used as a benchmark for gold for immediate delivery -- stood at $745 an ounce Tuesday morning local time, up $14.50 from Monday afternoon.
Among other metals, January platinum rose 2.3% to $815.10 an ounce. Platinum, a metal used in car catalysts and jewelry, dropped to $752.10 Monday, the lowest level since November 2003.
December copper rose 2.5% to $1.851 a pound, rebounding for a second day from a three-year low. December palladium rose 2.1% to $179 an ounce.
December silver fell 2.1% to $9.005 an ounce.
