Weak Data Hit Dollar, Aid Gold

Other economic news looks more promising, however, with the weekly leading index showing a 1.2% jump for the week ending Nov. 10 compared with a 0.6% gain in the previous period. The increase marks a 22-week high in the growth rate.

"Looking forward, growth prospects remain lackluster, they are not great," says Lakshman Achuthan, managing director at the Manhattan-based Economic Cycle Research Institute, which compiles the indicator. "But they have begun to revive a little. In itself that's good news, because if they weren't we'd be flirting more and more with recession risk."

In the gold patch, shares of Randgold(GOLD Quote) were rallying 1.6% recently, while those of Agnico-Eagle Mines(AEM Quote) were gaining 1.2%.

In base metals, Comex March-dated copper contracts closed up 1.75 cents at $3.0925 pound, after recovering from an intra-day low of $3.013.

" The new data does reinforce the situation of a weak demand over the past couple of months," says Peter Kettle, a copper analyst at CRU, a London-based specialty consulting firm, as the housing sector accounts for about 10% to 15% of U.S. end-use demand. "We certainly see a more difficult year ahead, but it could be offset by a revival in buying from China."

Traders quickly marked down shares of diversified miners Companhia Vale do Rio Doce(RIO Quote) and Rio Tinto(RTP Quote), were falling, off 1.3% and 1%, respectively as the impact of the weak housing sector sank in.

In ferrous metals, shares of U.S. Steel(X Quote) caught fire, shooting up 7.7% recently after rumors of a possible takeover bid out of Russia.