Gold tumbles 2.2%; other metals also sell off
By Polya Lesova, MarketWatch
Last Update: 8:43 AM ET Oct 2,
NEW YORK (MarketWatch) -- Gold futures tumbled more than 2% early Tuesday as traders rushed to lock in gains, with other metals prices also selling off sharply.
Gold for December delivery dropped 2.2%, surrendering $16.60 an ounce to stand at $737.50 on the New York Mercantile Exchange.
"Most of the precious complex has been hard hit by profit-taking," said James Moore, metals analyst at TheBullionDesk.com.
Market speculation now is of the view that "the current rallies are overdone," he wrote in a research note.
Metals finished close to multi-decade highs on Monday. Gold futures rose $4.10 to finish at $754.10 an ounce, after having hit an intraday high at $755, the loftiest level seen in nearly 28 years.
"Gold was due a breather after the large runup in recent weeks, and profit-taking and consolidation are to be expected," noted Mark O'Byrne, director of Gold & Silver Investments Ltd.
"The dollar has rallied and oil sold off, which may be leading to profit-taking in gold," he wrote in morning commentary.
On the currency markets, the dollar regained some ground against the euro after its recent weakness, with the European currency down 0.6% at $1.4154. The Dollar Index, which tracks the performance of the dollar against a basket of other currencies, moved up 0.4% at 78.25.
Oil prices continued to weaken, dropping back below $80 a barrel. November light crude contract slipped 76 cents at $79.48 a barrel.
Also in Tuesday's Nymex metals trading, silver for December delivery tumbled 47 cents, or 3.4%, at $13.395 an ounce, while December palladium dropped $9.50, or 2.6%, at $353 an ounce and October platinum fell $33.70, or 2.4%, at $1,362.50 an ounce.
December copper fell to $3.6685 a pound, down 2.3 cents.
Meanwhile, gold warehouse inventories rose by 79,316 troy ounces to stand at 7.1 million troy ounces as of late Friday, according to Nymex data. Silver supplies fell to 132.6 million troy ounces, down 1.4 million troy ounces, and copper supplies were unchanged at 20,115 short tons.
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