By Myra P. Saefong, MarketWatch
SAN FRANCISCO (MarketWatch) — Gold futures dropped Wednesday, extending their declines into a second session as a climb in the dollar to a nearly two-year high pushed prices for the dollar-denominated precious metal below $1,540 an ounce.
“Gold looks, feels and smells horribly exposed to the euro-zone debt crisis,” said Adrian Ash, head of research at BullionVault.
Gold for August delivery GCQ2 -0.74% , which is the most-active contract, fell $11.60, or 0.8%, to trade at $1,539.40 an ounce on the Comex division of the New York Mercantile Exchange. Prices, which fell more than $20 on Tuesday, touched an intraday low of $1,532.10.
July silver prices SIN2 -1.25% fell 35 cents, or 1.3%, to $27.44 an ounce.
The metals market saw broad losses along with most other commodities as the dollar climbed and the euro, pressured by growing concerns over Spain’s finances and contagion of debt woes in the region, fell to its lowest level against the greenback since July 2010.
Egan Jones Ratings Co. late Tuesday downgraded Spain’s debt to B from BB- with a negative outlook. Read more in Europe Markets.
The euro EURUSD -0.8467% fell to $1.2414, down from $1.2493 in North American trading late Tuesday, while the ICE dollar index DXY +0.44% , which measures the dollar against a basket of major rivals, rose to 82.673, up from 82.468 late Tuesday. Read more on currencies.
Strength in the greenback tends to pressure demand for dollar-denominated commodities such as gold.
Other metals declined, with platinum leading the pack. July platinum PLN2 -2.21% shed $28.90, or 2%, to $1,399.20 an ounce.
September palladium fell 1.8%, or $10.60, to $595.45 an ounce and July copper HGN2 -2.38% lost 7 cents, or 2%, to $3.39 a pound.
Myra Saefong is a MarketWatch reporter based in San Francisco.
