By Claudia Carpenter May 5 (Bloomberg) -- Gold fell for a second day in London as investors may have to sell the metal to cover losses in equities and other markets. Futures on the Standard & Poor’s 500 Index fell, after the index dropped 2.2 percent yesterday. Customers of Goldcore Ltd. in Dublin have sold some of their gold to pay off debts, Executive Director Mark O’Byrne said. Gold has risen 6.3 percent this year as the euro fell 9.7 percent against the dollar. “Some people have too much debt and they have to pay down the debt and therefore they sell their physical gold bullion holdings,” O’Bryne said. “The correlation with the equity markets is in the short term as oftentimes there are margin calls” to cover equity losses, he said. Gold for immediate delivery declined $5.03, or 0.4 percent, to $1,166.25 an ounce at 12:01 p.m. local time after falling 0.9 percent yesterday. Bullion futures for June delivery dropped 0.3 percent to $1,166.30 on the Comex in New York. The morning “fixing” of gold fell to $1,172 an ounce from $1,185 at the afternoon fixing yesterday. The fixing is used by some mining companies to sell production. More than $1.1 trillion was wiped from the value of global stocks yesterday amid speculation that the 110 billion euro ($143 billion) rescue package for Greece will need to be extended to Spain and Portugal. “Quite simply, gold could not withstand the wider market sell-off and forced margin calls,” Edel Tully, a precious metals strategist at UBS AG in London, wrote in a report today. Gains in the dollar against the euro have contributed to gold’s decline today, she wrote. Silver for immediate delivery dropped 1.2 percent to $17.6475 an ounce. Palladium declined 3.2 percent to $501.38 an ounce and platinum fell 0.9 percent to $1,654.60 an ounce. To contact the reporter on this story: Claudia Carpenter in London at ccarpenter2@bloomberg.net.

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