By Claudia Assis and Sarah Turner, MarketWatch
SAN FRANCISCO (MarketWatch) — Gold futures vied to rebound Thursday, fluctuating between small advances and retreats and trying to break a losing streak that shaved $130 off their price over three days deep in the red.
Gold for February delivery GC2G +0.06% declined 60 cents to $1,586.70 an ounce on the Comex division of the New York Mercantile Exchange.
The precious metal sold off on Wednesday, settling down $76.20 an ounce, or 4.6%, to $1,586.90 an ounce.
That was the lowest settlement for a most-active contract since mid-July and the first time gold had lost its grip on $1,600 since late September.
Gold came under pressure Wednesday after a Federal Reserve policy meeting indicated further major quantitative easing appeared unlikely.
Losses grew as the euro EURUSD +0.18% fell below the $1.30 mark for the first time since January after Italian bond yields spiked to a euro-era record, highlighting the funding difficulties that some European governments are facing.
The euro move impacted the gold market, said Jonathan Barratt, managing director at Commodity Broking Services in Sydney, as it resulted in U.S. dollar strength.
The dollar index DXY -0.40% traded lower on Thursday, after trading broadly flat earlier. It was recently at 80.191, from 80.538 in late North American trading after Wednesday’s dollar rally.
“If you look at the U.S. dollar and how it represents a safe-haven play, by default all commodities are under pressure,” said Barratt. “Also gold is one commodity which has held up, so it has had the furthest to fall.”
“We saw an initial break and, when we went through $1,630, we saw larger orders coming into the market. We feel the larger orders are a direct response to people exiting the exchange-traded funds and stop-loss orders going off,” Barratt said.
HSBC analyst James Steel said stress in the financial markets “has not stimulated safe-haven gold buying but has instead weakened the euro and indirectly helped drag gold lower.”
“Until some of the stress in the European financial markets abate, it will be hard to see a strong gold rally,” he added.
Other metals were mostly higher, with platinum the outlier. January platinum PL2F -0.60% was down $9, or 0.6%, to $1,417.30 an ounce.
March copper futures HG2H +0.66% gained 3 cents, or 1%, to $3.31 a pound. March silver SI2H +0.24% advanced 2 cents, or 0.1%, to $28.95 an ounce.
Claudia Assis is a San Francisco-based reporter for MarketWatch.
Sarah Turner is MarketWatch's bureau chief in Sydney.
