AP: Gold, most commodities fall as investors return focus to economic woes ahead
NEW YORK (AP) _ Gold and other commodities stumbled Wednesday, erasing some of the previous session's big gains and reflecting steep losses in the equities markets.
Commodities prices, which have tended to mirror the direction of equities in recent weeks, enjoyed a substantial rally on Tuesday as investors looked forward to putting the presidential election behind them.
But the euphoria wore off and reality set back in on Wednesday, as the focus again turned to a worsening economy and investors began wondering what the economic landscape will look like under the leadership of Barack Obama.
"The election is over, people are starting to worry again about the transition, some of the problems we still have," said Edward Meir, senior commodities analyst at MF Global.
"I think the equity markets have been leading the commodity markets for awhile and they will continue to do so," he said. "The economic outlook is poor across the board, so you can't have one sector going up while the other is going down."
Gold for December delivery fell $14.90 to $742.40 an ounce on the New York Mercantile Exchange.
Other precious metals were mixed. December silver rose 32.50 cents to $10.455 an ounce, while copper futures fell 13.90 cents to $1.8190 a pound.
On Wall Street, the Dow Jones industrial average fell nearly 500 points. Broader market indexes fell more than 5 percent. The U.S. dollar was slightly higher against other major currencies, including the euro and the British pound.
The yield on the benchmark 10-year Treasury note fell to 3.68 percent from 3.73 percent late Tuesday.
Energy prices fell on the Nymex on concern that a prolonged economic downturn will curb demand. Even indications that OPEC was acting on an earlier pledge to pull 1.5 million barrels of crude a day from the market failed to support prices.
Light, sweet crude for December delivery dropped $5.23 to settle at $65.30 a barrel. Gasoline futures fell 10.83 cents to $1.4244 a gallon, while heating oil futures fell 10.69 cents to $2.0547 a gallon.
Meanwhile, grain prices tumbled on the Chicago Board of Trade.
December wheat futures fell 35.25 cents to $5.3725 a bushel, and corn for December delivery fell 22.75 cents to $3.9025 a bushel.
