Gold Falls the Most in Two Weeks

Oil was little changed; reversing an earlier gain as Standard & Poor’s planned to say it may strip Germany and France of their AAA credit ratings and put all 17 euro nations on review for possible downgrade. Prices pared gains late in the day after reports that the agency may strip France and Germany of their AAA ratings amid Europe’s debt crisis. Prices advanced earlier after a Tehran-based newspaper cited a foreign ministry spokesman as saying crude will exceed $250 a barrel if nations threaten to ban Iranian exports.“The sovereign debt concern is far from over,” said Jason Schenker, president of Prestige Economics LLC, an Austin, Texas- based energy consultant. “The European economy is teetering on recession and the economic concern is weighing on commodity prices.”Crude for January delivery climbed 3 cents to $100.99 a barrel on the New York Mercantile Exchange, the highest settlement since Nov. 16 and the second-highest since June 9.Prices are up 11 percent this year.



GOLD

Gold fell the most in two weeks as European leaders worked to resolve the region’s sovereign-debt crisis, reducing demand for the metal as an alternative asset. Palladium capped the longest rally since April. German Chancellor Angela Merkel met with French President Nicolas Sarkozy today in Paris to advance proposals for stricter enforcement of the region’s budget-deficit rules, which they will present to the region’s leaders at a summit in Brussels on Dec. 9. The plan will “consume market attention this week, “UBS AG analyst Edel Tully wrote today in a report. “There is a renewed wave of optimism in the market that European policy makers are closer to finding a workable solution to stop the bleeding over the short term,” Scott Gardner , the chief investment officer at Verdmont Capital SA in Panama, said in an e-mail. “We are seeing a rotation out of gold into more cyclically exposed segments of the commodity market.” Gold futures for February delivery dropped 1 percent to settle at $1,734.50 an ounce at 1:46 p.m. on the Comex in New York. The drop was the biggest since Nov. 21. The metal gained 3.7 percent last week.