Gold slips after Monday rally as oil retreats, dollar bounces
Gold fell on Tuesday as investors locked in gains from the metal`s biggest one-day rally in six weeks, posted after a string of high-profile arrests in Saudi Arabia sent oil to a 2-1/2 year high, and the dollar and U.S. Treasury yields sank.
Spot gold was down 0.4 percent at $1,276.81 an ounce at 1050 GMT, while U.S. gold futures for December delivery were $4.30 an ounce lower at $1,277.30.
The metal rallied sharply in New York trading on Monday to end the day up nearly 1 percent, erasing losses made in earlier trading and throughout the previous session.
The Saudi-led jump in the oil price, a drop in the U.S. dollar and jitters linked to U.S. President Donald Trump`s trip to the Far East all conspired to push gold prices higher, MKS` head of trading Afshin Nabavi said.
However, it was struggling to maintain those gains, he added and stuck broadly within the $20 range of the past two weeks. "It is only going with oil and the U.S. dollar," he said. "Gold is not providing any reason to be bought."
Oil prices dropped back slightly on Tuesday, having been driven sharply higher after Saudi Arabia`s Crown Prince Mohammed bin Salman, tightened his grip on power through an anti-corruption purge by arresting some members of the kingdom`s political and business elite.
The campaign of mass arrests expanded on Monday after a top entrepreneur was reportedly detained in the biggest anti-corruption purge of the kingdom`s affluent elite in its modern history.
U.S. President Donald Trump`s visit to South Korea could also provide gold with some support over the next few days, traders said.
Trump flew into South Korea on Tuesday, the closest he has come to the frontlines of the nuclear standoff with North Korea, saying a solution must be found to the security threat posed by Pyongyang.
Among other precious metals, silver was down 1.1 percent at $17.04 an ounce after hitting its highest since Oct. 20 at $17.27 earlier in the session.
It outstripped gains in gold during Monday`s rally, ending the day 2.5 percent higher. That pushed the gold/silver ratio to its lowest since mid-September at 74.39.
"Not only was silver pulled up by gold yesterday – its gains were also twice as pronounced," Commerzbank said in a note. "Silver... is only just below the 200-day moving average. Any rise above this mark could spark technical follow-up buying and lend further buoyancy to the silver price."
Platinum was down 0.8 percent at $927.10 an ounce, while palladium was 0.1 percent lower at $998.80.
(This article has not been edited by Zeebiz editorial team and is auto-generated from an agency feed.)
Get Latest Business News, Stock Market Updates and Videos; Check your tax outgo through Income Tax Calculator and save money through our Personal Finance coverage. Check Business Breaking News Live on Zee Business Twitter and Facebook. Subscribe on YouTube.