Gold dropped below $910 Wednesday as a firmer U.S. dollar pressured the yellow metal to a two-month low. Silver and platinum were hit even harder while oil tumbled to its own seven-week low. U.S. stocks rallied late to post slight gains.
In New York trading futures for bullion:
Silver for September delivery dropped 36.8 cents, or 2.8 percent, to 12.852 an ounce.
Gold for August delivery fell $19.80, or 2.1 percent, to $909.30 an ounce — the lowest for a most-active contract since May 5.
- October platinum declined $34.00, or 3.0 percent, to $1,101.80 an ounce.
Notable precious metal quotes on the day follow:
"A major slide in crude oil prices aggravated bullion’s condition and the metal fell hard despite obvious safe-haven flows into…the yen today — and not the US dollar," wrote Jon Nadler, senior analyst at Kitco Inc. "The $880 to $900 area might come into the focus of players next."
"The dollar’s recent stability, coupled with an impressive crude-oil decline in the past several days, has gold bulls on the defensive," Ralph Preston, a Heritage West Futures Inc. commodity analyst in San Diego, was quoted on Bloomberg. "I have a very specific trade recommendation to short the gold market on today’s break of $915 support."
In London bullion, the benchmark gold price was fixed earlier in the day to $918.00 an ounce, a $6.00 decline. Silver gave back most of Tuesday’s 29 cent gain to fall 27 cents to $13.05 an ounce. Platinum was fixed $33.00 lower to $1,110.00.
Gold, considered a hedge during times of high inflation and economic uncertainty, tends to follow oil and move opposite to the U.S. dollar. A rising greenback makes dollar-denominated commodities, like bullion, more expensive for holders of other world currencies.
Oil and gasoline prices
Oil plunged for the sixth straight session and to a seven-week low on Wednesday after the Energy Information Administration reported inventories last week were higher and consumption plummeted.
New York crude-oil for August delivery fell $2.79, or 4.4 percent, to close at $60.140 a barrel.
Prices at the pump followed the decline, according to AAA. The national average for unleaded gasoline fell 1.1 cents to $2.593 a gallon. The price is: 3.7 cents below last week, 2.6 down from a month back, and $1.52 lower than a year ago.
U.S. stocks rallied late with worries over a slower than expected economic recovery cited for earlier day weakness. The Dow Jones industrial average gained 14.81 points, or 0.18 percent, to 8,178.41. The S&P 500 Index fell 1.47 points, or 0.17 percent, to 879.56. The Nasdaq Composite Index rose 1.00 points, or 0.06 percent, to 1,747.17.