By Myra P. Saefong and Barbara Kollmeyer, MarketWatch
SAN FRANCISCO (MarketWatch) — Gold futures fell by more than $30 an ounce Tuesday, as the dollar held onto gains amid continued concern about political upheaval in Europe.
Gold for June delivery GCM2 -2.16% fell $33.50, or 2%, to $1,605.70 an ounce on the Comex division of the New York Mercantile Exchange, after tapping a low of $1,603.40. Futures prices had lost $6.10, or 0.4%, on Monday.
The ICE dollar index DXY +0.43% , meanwhile, traded at 79.903, up from 79.611 in late North American trade Monday.
The dollar continued to rise from Monday as investors sought what are perceived as less-risky assets after weekend elections in parts of Europe. Elections on Sunday resulted in the defeat of French President Nicolas Sarkozy and ushering in of Socialist challenger Francois Hollande.
In Greece, meanwhile, parliamentary elections on Sunday resulted in major defeats for the mainstream parties, which are struggling to form a majority.
A stronger dollar pressures dollar-denominated commodities as it makes them more expensive for holders of other currencies.
Overall, “people are growing tired of the financial crisis,” said Adrian Ash, head of research at BullionVault. “Even though they can’t escape it, that’s creating fatigue with gold as an investment story.”
But “the crisis isn’t going away, and investment gold holdings have remained very strong,” he said in emailed comments. “We’re now seeing an upturn in Comex net length, plus a rebound in coin sales. Underlying demand at BullionVault has now added half-a-tonne to our users’ holdings in the last 5 weeks.”
For now, other commodities such as oil were declining on Tuesday, while European and U.S. stock markets traded lower. Read more on Europe Markets.
The broader suite of metals futures took their cue from losses in gold.
Silver for July delivery SIN2 -2.61% retreated 77 cents, or 2.6%, to $29.35 an ounce. Platinum for the same month’s delivery PLN2 -1.37% was off $20.50, or 1.3%, to $1,509.60 an ounce.
June palladium PAM2 -3.33% fell $22.15, or 3.4%, to $625.65 an ounce.
Copper for July delivery HGN2 -2.88% slipped 10 cents, or 2.7%, to $3.67 a pound.
Myra Saefong is a MarketWatch reporter based in San Francisco.
Barbara Kollmeyer is an editor for MarketWatch in Madrid.
