Economic Uncertainty Chips Away At Gold Prices
By SANDY SHORE
Uncertainty about U.S. budget talks is chipping away at gold prices.
Gold fell $25.30, or 1.5 percent, to finish Tuesday at $1,695.80 an ounce. That's the lowest in a month.
Republicans and Democrats remain far apart on their budget proposals with just weeks left before the U.S. reaches the "fiscal cliff." That refers to automatic tax increases and government spending cuts which will take effect Jan. 1. Economists believe those measures could send the U.S. back into a recession.The slow pace of the talks have left many investors and traders uncertain about putting money into commodities. If the U.S. economy slows, it could cut demand for industrial metals, oil and other raw materials. Some traders sold gold and other commodities to book profits while others are staying out of the market as they evaluate their portfolios ahead of the end of the year. "I personally think it all comes down to the 'fiscal cliff' right now," Kingsview Financial analyst Matt Zeman said. "That's what everybody is watching and for all practical purposes, our political leaders, from what I can tell, are still at a complete standstill." Many investors are looking ahead to Friday when the Labor Department will release employment data for November, which should offer more clues about the strength of the economy. Most commodities ended the day lower. March silver fell 95.1 cents, or 2.8 percent, to $32.808 per ounce, March copper was essentially flat at $3.6555 per pound, March palladium fell $8.55 to $682.70 per ounce and January palladium fell $30.90 to $1,582.90 per ounce. Benchmark oil fell 59 cents to $88.50 per barrel, heating oil dropped 5.22 cents to $3.004 per gallon, wholesale gasoline fell 3.75 cents to $2.689 per gallon and natural gas dropped 5.2 cents to $3.539 per 1,000 cubic feet.
Select the service that is right for you!COMPARE ALL SERVICES
Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
- Weekly roundups
Access the tool that DOMINATES the Russell 2000 and the S&P 500.
- Buy, hold, or sell recommendations for over 4,300 stocks
- Unlimited research reports on your favorite stocks
- A custom stock screener
- Upgrade/downgrade alerts
Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.
- Diversified model portfolio of dividend stocks
- Alerts when market news affect the portfolio
- Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.
- Real Money + Doug Kass Plus 15 more Wall Street Pros
- Intraday commentary & news
- Ultra-actionable trading ideas
Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.
- 100+ monthly options trading ideas
- Actionable options commentary & news
- Real-time trading community
- Options TV