Dollar Rally Weighs on Gold

The recent bullion rally, which has taken spot prices from around $608 on Jan. 8 to $646 recently, seems to have shaken out some physical buyers, one observer notes.

In particular, India's purchases appear to have dwindled to a trickle during the rally, says Rhona O'Connell, an analyst at GFMS Analytics in the U.K.

Turning to the miners, the CBOE Gold Index was dipping 0.6%, pulled under in part by shares of component Gold Fields(GFI Quote), off 2% recently.

Barrick Gold(ABX Quote) and Newmont Mining(NEM Quote) were down also, losing 1% and 0.4%, respectively.

As for base metals, copper was losing 3 cents at $2.62 a pound on the Comex.

Elsewhere in the sector, the Indian conglomerate Aditya Birla is expected to submit a bid of between $5 billion and $6 billion for aluminum maker Novelis(NVL Quote), according to a report from the Hindustan Times. The company confirmed it was in talks to sell itself, but it didn't name the potential buyer.

Shares of Novelis were rallying 23% recently.