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Gold Tumbles As Fear for European Debt Grows
Sep 13,2011 09:02CST
industry news
Source:SMM
Gold futures on the COMEX Division of the New York Mercantile Exchange ended drastically lower on Monday

CHICAGO, Sept. 12 (Xinhua) -- Gold futures on the COMEX Division of the New York Mercantile Exchange ended drastically lower on Monday, as Europe's sovereign-debt troubles continued to be a drag on market sentiment and investors had to cash in positions to cover losses in other markets.

The most active gold contract for December delivery trimmed 46. 2 dollars, or 2.5 percent, to 1,813.3 dollars per ounce.

European and U.S. equity market fell on a report that Moody's Investors Service is considering a downgrade of French banks due to their exposure to Greece, as well as concerns that the eurozone 's sovereign debt crisis could undermine a global economic recovery.

A trader mentioned that although the fundamental of gold market remains well supported, volatility in other markets tends to have a knock-on effect on the bullion, as many hedge-funds and traders had to compensate losses by liquidating gold positions.

The U.S. dollar index, which measure the U.S. unit against a basket of six other major currencies rose on Monday, adding more downward pressure to the bullion. A stronger dollar makes dollar- denominated assets more expensive to holders of other currencies.

Silver for December delivery lost 1.407 dollars, or 3.4 percent, to 40.217 dollars per ounce.

 

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