After two-session win, market digests election outcome
WASHINGTON (MarketWatch) -- Gold futures pulled back Wednesday after gaining more than $39 an ounce over the past two sessions as traders digested the outcome of the U.S. presidential election.
Gold for December delivery fell by $2.30, or 0.3%, to $755 an ounce on the Comex division on the New York Mercantile Exchange.
More recently, the contract traded at $754, down $3.30 in electronic trading on Globex. It touched a one-week high of $770 overnight.
Prices had gained $39.10, or 5.4%, during a two-session winning streak.
"We said some weeks ago that the recent sell-off in precious metals was likely to end around Election Day and believe that this has indeed happened and that gold will resume its secular bull market in the coming weeks," said Mark O'Byrne, a director at Gold and Silver Investments Ltd.
"Important elections often see markets reverse course and witness trend reversals, and this is one of the most momentous election victories in U.S. history," he said in a note to clients.
Sen. Barack Obama rode massive voter turnout to a sweeping victory over Sen. John McCain in Tuesday's presidential contest, becoming the first African-American elected as the nation's chief executive. See full story.
But a potentially deep U.S. recession and the direst global financial crisis since the Great Depression will give Obama little time to bask in the afterglow of his historic win, economists said Wednesday. See full story.
Concerns about an economic recession as well as weakness in the dollar had been providing support for gold prices recently.
On Wednesday, the dollar index , a measure of the greenback against a trade-weighted basket of six currencies, was last at 84.98, up from 84.533 late Tuesday. See Currencies.
Copper drops back; other metals rise
Copper prices lost ground along with gold Wednesday after rising more than 6% in the previous session.
Copper for December delivery was at $1.843 a pound, down 11.5 cents, or 5.9%.
Other metals inched higher, with December silver up 2 cents to $10.15 an ounce after tacking on 3.9% Tuesday.
December palladium rose 1.8% to stand at $213.5 an ounce, and January platinum gained 2.4% to $878.40 an ounce. Read related story.
Elsewhere in the commodity markets, oil futures fell more than 2%, pulling back after Tuesday's rally. See Futures Movers.
The Reuters/Jefferies CRB Index a benchmark gauging the prices of major commodities, fell by 0.2% to 277.79 points.
