Investing.com – Gold futures moved lower in Asian trade Friday for a fourth straight session, as European leaders prepared for a weekend summit to debate strengthening the regional debt rescue fund and the precious metal tracked a general downturn in commodities.
On the Comex division of the New York Mercantile Exchange, gold futures for December delivery traded at USD1,613.05 a troy ounce during early Asian trade, dropping 0.58%, after hitting a high of USDS1,624.75.
On Thursday, French President Nicolas Sarkozy and German Chancellor Angela Merkel issued a joint statement from Frankfurt, where the two agreed to meet Saturday in Brussels a day before the scheduled Sunday summit of European leaders.
Sunday’s confab in Brussels has become the focus of investor hopes since officials from the Group of 20 last weekend set the day as a deadline for Europe to devise a concerted action to boost the USD603 billion European Financial Stability Facility rescue fund.
Earlier Thursday, the U.S. National Association of Realtors reported that sales of new homes fell less than expected in September to 4.1 million from 5.06 million the previous month. Economist forecasts had predicted a drop to 4.9 million for the period.
And a Thursday report from the Federal Reserve Bank of Philadelphia showed that manufacturing activity in the state grew in October to a seasonally adjusted 8.7, from minus 17.5 the month before.
Analysts had expected the index, widely viewed as a harbinger of national trends, to fall by 9.5 last month and the data represented the biggest one month turnaround in 31 years.
Wall Street stocks swayed between red and black for most of the day before settling mixed; The Dow Jones Industrial Average gained 0.32% to 11,541.80, the Nasdaq Composite Index fell 0.21% to 2,598.62 and the S&P 500 advanced 0.46% to close the day at 1,215.39.
Gold was likely to remain in a “dead trade” until it can resume its role as a fear barometer and is able to rally in face of equities weakness,” Adam Klopfenstein, strategist at MF Global, told MarketWatch.
If gold can’t go back to being that fear barometer, “it will be treated as a physical commodity entangled with other assets and with few chances for seeing significant upside in the next months,” Klopfenstein added.
A lower dollar helped provide downside support gold futures, as a weaker greenback makes gold futures purchases less expensive for holders of other currencies.
The dollar index, which tracks the performance of the greenback versus a basket of six other major currencies, was down 0.02% to 77.21.
On the Comex, silver for December delivery retreated 0.76% to trade at USD30.31 a troy ounce, while copper for December delivery edged down 0.07% to trade at USD3.081 a pound.