MW: Gold futures extend losses to touch two-week low
By Polya Lesova & Myra P. Saefong, MarketWatch
SAN FRANCISCO (MarketWatch) -- Gold futures headed lower for a second straight session Wednesday, dropping as much as $18 an ounce to revisit levels not seen in more than two weeks, as the dollar rose against most other major currencies.
Gains in the U.S. currency put some pressure on demand for the precious metal.
"World market conditions remained glum as little in the way of positive catalysts emerged overnight to help buyers jump in with cash," said Jon Nadler, senior analyst at Kitco Bullion Dealers, in a note.
Gold for December delivery dropped $15.30 to $728 an ounce in electronic trading on Globex.
Earlier, the contract hit $715 an ounce, the lowest intraday price since Oct. 24.
"The overall mood remains fragile," said Edward Meir, an analyst at MF Global, commenting on the metals sector in general.
He cited short covering as the only factor on the horizon to make the case for sustained move higher.
"At this stage, the best we can hope for is for the various metals to enter a prolonged, sideways drift, an indication that participants are finally concluding that the worst of the declines are behind us," Meir said.
On Tuesday, gold futures dropped $13.70, or 1.8%, to close at $732.80 an ounce.
On Wall Street, U.S. stocks fell Wednesday, with Best Buy becoming the latest firm to issue a profit warning at a time of growing fears over the health of financials and automakers. See Market Snapshot.
In foreign-exchange trading, the dollar index , a measure of the greenback against a trade-weighted basket of six major currencies, was up slightly at 87.346 from 87.250 late Tuesday. See Currencies.
"Everything points to continued dollar strength, which would lead me to think that commodities will continue their downward spiral," said Dale Doelling, chief market technician at Trends In Commodities.
Also in Globex action Wednesday, December silver fell 3.6 cents to $9.45 an ounce, while January platinum lost $3.10 to $823.50 an ounce and December palladium sank $4.30 to $214.95 an ounce. December copper traded slightly lower at $1.641 a pound.
Metals equities followed the broader U.S. stock market lower.
The Amex Gold Bugs Index , which tracks the share prices of major gold companies, dropped 5.6% to 185.91.
The iShares Gold Trust shed 2% to $70.83, while the iShares Silver Trust ETF lost 3% to $9.348. The Market Vectors-Gold Miners ETF also fell, surrendering 5.2% to $20.52.
Elsewhere on the commodity markets, crude-oil futures traded at a fresh 21-month low as concerns about a sharp slowdown in demand weighed.
