Gold and most other commodities retreated Tuesday, during another tumultuous day on Wall Street, as economic concerns once again weighed on investors.
The commodities markets have largely followed the direction of equities in recent weeks as investors flee both stocks and futures amid evidence of a worsening economy. The fear is that a prolonged economic downturn will curb demand for basic materials.
Tuesday was no different, said Tom Pawlicki, commodities analyst with MF Global Research in Chicago.
"If you look at the chart of the commodities markets and compare it with equities, they are almost the same," Pawlicki said.
Commodities enjoyed a temporary rally at the start of the day, as investors welcomed a better-than-expected forecast from computer maker Hewlett-Packard Co. The markets turned lower at midday, giving way to more downbeat economic news including a government report showing wholesale prices plunging a record amount in October, a drop that could indicate a rising threat of deflation.
While Wall Street staged a late-day rally, commodities mostly ended lower. Most futures markets close before the stock market.
Gold for December delivery fell $9.30 to $732.70 an ounce on the New York Mercantile Exchange, after rising as high as $745.60 earlier in the session.
Other precious metals prices advanced.
December silver rose 22 cents to $9.55 an ounce, after oscillating between a high of $9.74 and a low of $9.1150 during the session. March copper futures inched up 0.45 cent to $1.6715 a pound.
The Dow Jones industrials finished up about 151 points. Broader market indexes also ended the session in positive territory.
The U.S. dollar fell against most other currencies. The yield on the benchmark 10-year Treasury note fell to 3.53 percent from 3.66 percent.
Energy prices fell on the Nymex, after the Labor Department reported that wholesale energy prices dropped by 12.8 percent in October, the biggest one-month fall since 1986. All types of fuel declined, with gasoline falling by a record 24.9 percent, also the biggest drop since 1986. Home heating oil prices fell 9.6 percent.
Light, sweet crude for December delivery fell 56 cents to settle at $54.39 a barrel.
In other Nymex trading, gasoline futures fell 3.78 cents to settle at $1.1368 a gallon. Heating oil fell 3.31 cents to settle at $1.7579 a gallon.
Grain prices also declined.
March wheat futures fell 4.5 cents to settle at $5.495 a bushel on the Chicago Board of Trade, while corn for March delivery slipped 6.5 cents to $3.965 a bushel.
January soybeans fell 4.5 cents to $9.02 a bushel.
