NEW YORK (
tiptoed lower Monday as fresh M&A news prompted investors to tentatively buy stocks.
Gold for December delivery settled 30 cents lower at $1,228.50 an ounce at the Comex division of the New York Mercantile Exchange. The gold price Monday traded as high as $1,234 and as low as $1,223.50 on very low volume. The
was adding 0.07% to $83.13 while the
euro was slightly lower
at $1.26 vs. the dollar. The spot gold price Monday was down $1, according to Kitco's gold index.
The recent pickup in
continued Monday as a bidding war heated up between
Consolidation is typically a positive for equities because it signals that companies have cash and want to grow, which can lead investors into riskier stocks rather than safer gold.
Last week's deals, however, were overshadowed by fears that a global economic recovery was stalling out. Those concerns helped push gold prices past $1,230 an ounce and up 1%. But with volume thinning, a stronger U.S. dollar and a lack of any major economic data Monday, traders lost interest in gold and opted for stocks.
"Any news will be needed to move these markets either up or down," says George Gero, vice president of global futures at RBC Capital Markets. "Uncertainty and indecision in the meantime on low volume can enlarge daily ranges prior to next option expiration" on Thursday.
Regardless of any price dips, gold is expected to show resilience ahead of fall's busy buying season. "
Gold does not really want to go much below the $1,200 level," says David Morgan, founder of
. "What I expect is a minor sympathetic move with the stock market to the downside, but very briefly, and then immediately go up ... and that would show that gold is doing its job
as a wealth protector."
This week investors will look for direction from data on the housing market with July new and existing home sales numbers, along with durable goods orders, which measure the purchasing health of consumers and businesses.
settled flat at $17.99, while copper closed unchanged at $3.29. Morgan believes that silver will suffer over the long term if stocks sell off. "You see silver actually sympathize more with the S&P." ... I think we may see it in the low $17s, perhaps below $17 before we find a more recent bottom."
Gold mining stocks, a risky but potentially profitable way to
, were lower.
was down 2.80% to $6.60 while
was slipping 1.82% to $17.76. Other gold stocks
were trading at $10.09 and $4.91, respectively.
Written by Alix Steel in New York.
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