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Gold futures little changed ahead of U.S. vote

Published 11/06/2012, 03:17 AM
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Investing.com - Gold futures were little changed in lackluster trade during European morning hours on Tuesday, as markets continue to be subdued in the final hours ahead of the U.S. elections.

On the Comex division of the New York Mercantile Exchange, gold futures for December delivery traded at USD1,685.95 a troy ounce during European morning trade, up 0.15% on the day.

Prices held in a tight trading range of USD1,687.05 a troy ounce, the daily high and a session low of USD1,683.55 a troy ounce. Prices fell to a nine-week low of USD1,672.55 a troy ounce on Monday.

Gold prices were likely to find support at USD1,646.45 a troy ounce, the low from August 31 and resistance at USD1,727.25, the high from October 31.

Market participants stayed on the sidelines ahead of the start of voting in the U.S. presidential elections, with opinion polls pointing to a tight race between incumbent President Barack Obama and Republican contender Mitt Romney.

If the election comes down to a thin margin in a swing state such as Ohio, the outcome could be delayed for days or weeks.

Greece was also on investors mind, as the country’s parliament prepared to vote on the latest rounds of austerity measures on Wednesday, which could determine if Athens receives its next tranche of financial aid.

Markets also continued to eye developments surrounding Spain, amid ongoing uncertainty over whether the debt-strapped country is moving closer to formally requesting a bailout from its euro zone partners.

A bailout would allow the European Central Bank to step in and buy Spanish sovereign debt, which would result in reduced borrowing costs for the debt-strapped nation. But Spain has been reluctant to do so because it may come with conditions on its budget.

Investors will then turn their focus to the start of the 18th Chinese Communist Party Congress on Thursday, where a once-in-a-decade leadership change is to take place.

The dollar index, which tracks the performance of the greenback against a basket of six other major currencies, was little changed near a two-month high limiting the precious metal's appeal as an alternative asset.

Elsewhere on the Comex, silver for December delivery eased up 0.15% to trade at USD31.17 a troy ounce, while copper for December delivery added 0.4% to trade at USD3.483 a pound.

Copper traders were looking ahead to a flurry of Chinese economic data later in the week, including reports on inflation and industrial production, to gauge whether the world second largest economy is heading towards a hard or a soft landing.

The Asian nation is the world’s largest copper consumer, accounting for almost 40% of world consumption last year.

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