MW: Gold prices slip under $1,300 as equities rise
By Myra P. Saefong and Shawn Langlois, MarketWatch
SAN FRANCISCO (MarketWatch) — Gold futures fell back under $1,300 an ounce on Monday as an overall climb in the U.S. equities market drew investors’ attention away from the precious metal.
Gold for June delivery GCM4 -0.55% fell $7.30, or 0.6%, to $1,293.40 an ounce on the Comex division of the New York Mercantile Exchange.
Among the most active contracts for silver, May silver SIK4 -0.87% also dipped 17 cents, or 0.9%, to $19.52 an ounce, while the July contract SIN4 -0.85% traded at $19.56 an ounce, down 16 cents, or 0.8%.
Gold’s drop is “due to an orchestra of events,” said Adam Koos, president and portfolio manager at Libertas Wealth Management Group.
The decline could have something to do with the fact that Newmont Mining Corp. NEM -6.50% has dumped the merger and acquisition negotiations with Barrick Gold Corp. ABX -2.21% CA:ABX -2.23% , he said.
He also said M&A news on the “non-gold” front was so good early Monday that they added confidence to the market, driving prices in equities up, and thus, hurt the “‘flee to gold safety’ crowd.” U.S. stocks traded higher Monday as deal news among drug and telecom companies helped boost sentiment.
It’s the same or similar story with new sanctions on Russia, which may mute further geopolitical turmoil with Ukraine, adding pressure to gold prices, said Koos.
The White House on Monday announced a series of additional sanctions on Russia for its actions in Ukraine. It’s imposing sanctions on seven Russian government officials and 17 companies linked to the “inner circle” of Russian President Vladimir Putin. The European Union also agreed to hit 15 more Russian and Ukrainian individuals with sanctions.
Gold prices also fell in the wake of data showing that U.S. pending-home sales rose 3.4% in March, marking the first gain in nine months.
Prices for the yellow metal ended last week with a third-consecutive gain, marking for the first weekly uptrend in two weeks. The price of gold closed above that key $1,300 level for the first time since April 16.
Looking ahead, along with a packed earnings slate, some of the data that gold investors will plug into during the week include the monthly jobs report, first-quarter gross domestic product and the latest word out of the Federal Reserve. Read more: Spring tide seen lifting U.S. hiring
Elsewhere in metals trading, July platinum PLN4 -0.56% fell $7.10, or 0.5%, to $1,417.20 an ounce, while June palladium PAM4 -1.30% shed $9.20, or 1.1%, to $802 an ounce.
High-grade copper for May delivery HGK4 -0.24% was down half a cent at $3.12 a pound. July copper HGN4 -0.15% , which is now the most-active contract, traded nearly flat at $3.09 an ounce.
Metals miners traded mostly lower Monday, with Newmont Mining shares dropping 6.4% and Barrick Gold shares falling 1.7% after Barrick said it was Newmont’s decision to terminate merger talks.
The Philadelphia Gold and Silver Index XAU -1.80% and the NYSE Arca Gold Bugs Index XX:HUI -1.80% each declined by 1.7%. The SPDR Gold Trust GLD -0.60% fell 0.6%.
