Gold Prices Waver on U.S. Housing Data
Gold for April delivery shed $1.50 to settle at $1,774.90 an ounce at the Comex division of the New York Mercantile Exchange. The gold price traded as high as $1,781 and as low as $1,762.60 an ounce while the spot price was falling $5, according to Kitco's gold index.
Equities bounced off morning lows after pending home sales data from the National Association of Realtors approached a two-year high in January, with a climb of 2% last month. Sales were expected to have risen 1% in January, according to Thomson Reuters, following a 3.5% drop in December. The report said that the group is expecting price stabilization and possible price growth this year.
"Overall, the direction of the various revisions, along with the January estimate, point to a choppy, though steadily improving trend," said economists at Barclays Capital Research. "As pending home sales progress, existing home sales tend to follow with a month or two lag, which suggests the modest improvement in the housing market is likely to continue."
"It is clear that gold is facing a number of potential negatives," said a report from RJ O'brien. "In addition to adverse currency market action, the markets are somewhat fearful of global slowing off ultra high oil prices."
George Gero, senior vice president with RBC Wealth Management, believes that gold prices will still find the momentum to reach $1,800 by June.
"Reluctance of G20 action
Jon Nadler, senior metals analyst with Kitco Metals, is still eying waning physical demand in the metal in India and the U.S. Despite this, Nadler sees bullish sentiment for gold rising to a level that, he believes, signals a correction is due. "Bullish sentiment is approaching certain levels (above 90% according to trade-futures.com's Daily Sentiment Index) from which previous sharp corrections have ensued," he said.
Gold mining stocks were largely following gold prices and other commodities lower. Among the exceptions were Eldorado Gold
Among the biggest laggards in the sector were Iamgold
-- Written by Ross Tucker in New York.
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