Gold prices fell to their lowest levels in more than a month after a rally in the Nasdaq Composite to record highs prompted traders to shun the precious metal for equities.
Gold for June delivery, the most actively traded contract, slipped by more than $17.17 or 1.5% to $1176.90 an ounce on the Comex division of the New York Mercantile Exchange.
This is the precious metal’s biggest one day decline since March 6.
The contract is on a track for a 2.2% weekly decline and, according to data from Fact set , it has not closed below $1180 an ounce in more than 5 weeks.
World stocks recorded solid gains on Friday and the Nasdaq Composite was spurred by a rally in technology shares to a post dot-com-boom record high taking investment demand away from gold.
That takes investment demand away from gold,” Bill O’Neill, co-founder of commodities investment firm LOGIC Advisors in Upper Saddle River, New Jersey. O’Neill, told Reuters.
“Significant funds are flowing toward European and Japanese equities as well in the flavor of the moment.”
Spot Gold slipped 1.4% to $1177.03 an ounce.
Positive economic data from the US showing that orders for durable goods were up by a seasonally adjusted 4% in March failed to lift market sentiment although the resurgence of the Euro and other major currencies against the dollar helped pare losses.
“This week’s action in gold reflects indecision more than anything else,” Katrina Lamb, head of investment strategy and research at MV Financial, told MarketWatch.
“The pattern for the week as a whole was up one day, down the next.”
“Barring any X-factor that sends investors fleeing into safe havens, we expect indecision will continue to be the watchword until we have more clarity” on interest rates from the Federal Reserve, she said.
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