Of DOW JONES NEWSWIRES
NEW YORK (Dow Jones)--Gold futures fluctuated near the unchanged mark Thursday as the metal's six-day rally fizzled, with investors unsure whether demand will support prices near $1,200 an ounce.
The most actively traded contract, for December delivery, rose $1,70, or 0.1%, to $1,197.60 an ounce on the Comex division of the New York Mercantile Exchange.
Physical demand had fueled gold's recent rally, as buyers sought to enter the market at a discount from the metal's recent highs. But bargain hunters will likely stay on the sidelines Thursday, as gold has advanced for six consecutive sessions, rising about 3%.
"As prices have gained momentum that interest has started to retreat and now the baton will need to be passed over to investment demand to drive gold prices," said Suki Cooper, analyst with Barclays Capital.
Gold briefly rose above the $1,200 an ounce mark Thursday, but wasn't able to hold on to gains as traders weighed the uncertain demand outlook for gold. The rush of fear-based refuge buying that propelled the precious metal to record highs in June has largely disappeared as markets have stabilized. Gold is sometimes bought on the belief that it holds its value better than other assets during economic turmoil.
The most-active contract hasn't settled above $1,200 since July 15.
Prices didn't react strongly to a U.S. jobs report Thursday. Weekly unemployment claims rose by 19,000, to 479,000, in the week ended July 31, the Labor Department said, their highest level since the week ended April 10. Analysts said investors were looking ahead to Friday's highly anticipated monthly employment report.
Platinum and palladium futures continued to fall, as Thursday's jobless report hit industrial commodities like copper and crude oil. Platinum and palladium have more industrial uses than gold, and are more closely tied to the growth outlook.
