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Gold falls to start final week of 2015
Gold futures were in negative territory Monday, mirroring a broader slump in commodities that saw oil and copper prices slide in the final trading week of 2015.
February gold GCG6, +0.43% lost $6.90, or 0.7%, to trade at $1,069 an ounce and is down about 10% year to date.
Meanwhile, high-grade copper HGH6, +1.88% for March delivery sank 4 cents, or 2.1%, to trade at $2.08 a pound. The industrial metal is on pace to record its worst annual loss—down around 25%—since 2008.
Commodity prices came under pressure in New York after a report that industrial-company profits from China declined, suggesting weakening demand for metals, including gold. News that Beijing might loosen rules to make it easier for companies to list on China’s stock exchanges, possibly diminishing demand from exiting stocks, helped China stocks SHCOMP, +0.85% 399106, +0.91% along with the industrial-profits report, record their biggest drop in about a month.
A fresh downturn in crude-oil futures CLG6, +0.41% also were a drag on broader commodity prices. Slumping oil can weigh on metals and other commodities because commodities tend to be bought as a basket of assets and a fresh downdraft in oil can scare investors away, particularly toward the end of the year when investors are hesitant to make risky bets, market participants say.
“The drop in oil prices overnight has reasserted some pressure on the gold and silver markets and although a softer tone may be expected this week, the metals should remain in a relatively tight range as the world gets ready to ring in 2016,” said Peter Hug, global trading director, at metals broker Kitco.
“Gold should be contained in the $1,062- $1,078 [an ounce],” Hug added.
The moves in metals comes as London markets are off for Boxing Day. Most markets are expected to experience low volumes until after New Year’s Day.
Elsewhere in Comex, other metals were under pressure. March silver SIH6, +0.94% lost 46 cents, or 3.2%, to trade at $13.92 a pound, January platinum PLF6, +0.69% was $6.20, or 0.7%, lower at $878 an ounce, while March palladium PAH6, +1.05% lost $3.75, or 0.7%, to trade at $555.50 an ounce.
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