Gold prices climbed on Tuesday as the dollar declined, hiking demand for bullion as an investment option after data showed housing starts and building permits dropped to record lows in April. The dollar declined versus its currency rivals after reports that Goldman Sachs Group Inc., JPMorgan Chase & Co.and Morgan Stanley moved to repay $45 billion in government rescue money. Analysts were also disheartened by data showing a decline in U.S. housing starts. Read Economic Report on housing starts. "This morning report of a 12.8% decline in housing starts in April versus the prior month continues to suggest the bottom in housing still hasn't been reached," said Fred Dickson, chief market strategist, Davidson Companies. "Although the credit picture is improving and the job loss rate appears to be showing signs of slowing, housing remains the weak link in the economic picture. We continue to believe that an economic recovery probably won't begin until the fourth quarter at the earliest," said Dickson. Gold for June delivery ended up $5.00, or 0.5%, at $926.70 on the Comex division of the New York Mercantile Exchange. The U.S. dollar index , which tracks the greenback against a trade-weighted basket of six major currency rivals including the euro and yen, has fallen nearly 3% so far this month, furthering the allure of gold as an investment vehicle. The index was down 0.1% Tuesday. Read Currencies. The major stock indexes wavered between gains and losses, with the Dow Jones Industrial Average lately up 27.87 points at 8,531.95. The S&P 500 gained 6.42 points to 916.13, while the Nasdaq Composite added 16.45 points to 1,748.81. Read detailed report. "Yesterday's stock market rallies managed to divert a fair amount of sidelined as well as committed cash, but there remain plenty of hedge funds whose bets on the commodities sector are keeping a floor under metals and energies," said Jon Nadler, senior analyst, Kitco Metals Inc.

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