Gold prices plunged Monday, hurt by a stronger dollar and lower oil prices. December-stamped gold contracts moved to $776.80, down $42.20 for the session. In intraday trading, gold hit as low as $769.
The precious metal fell as the dollar experienced moved to a weekly high against the euro and a 10-day high versus British pound. Gold usually moves in the opposite direction as the dollar as traders tend to turn to the metal as a safety outlet.
Gold's hedge appeal further took a hit as crude oil prices fell to $49.28 per barrel, down $5.15. Oil dropped after the Organization of Petroleum Exporting Countries delayed its decision to cut output until later this month.
On the economic front, the ISM's index of activity in the manufacturing sector fell to 36.2 in November from 38.9 in October, with a reading below 50 indicating a contraction in the sector. With the decrease, the index fell to its lowest level since May of 1982.
Separately, the Commerce Department released its report on construction spending in the month of October, showing that spending fell by more than expected amid a notable decrease in spending on residential construction.
Gold prices moved higher on Friday on a light day in U.S. trading amid a flight to safety following the deadly terrorist attacks in India. Gold for December settlement closed up $7.70 on the session. Trading was light with many traders enjoying a four-day Thanksgiving weekend.
Last week, gold added $14.40 and finished the month of November up $98. The 14% rise in November was the largest one-month gain since 1999. The climb helped gold pull away from a multi-month low near $680 reached in October.
