Gold futures on the COMEX division of the New York Mercantile Exchange extended losses on Wednesday amid a strong U.S. dollar and gradual pick-up in New York stock market.
The most active gold contract for April delivery fell 6.90 U.S. dollars, or 0.42 percent, to settle at 1,643.10 dollars per ounce.
U.S. stocks traded higher on Wednesday morning, rebounding from a steep sell-off in the previous two sessions due to concerns about the coronavirus outbreak.
Prior to gold’s settlement, all the benchmark stock indexes, including the Dow Jones Industrial Average, S&P 500 and Nasdaq Composite Index, climbed into positive territory.
When equities rebound, the precious metal usually goes down, as investors are not necessarily looking for a safe haven.
The U.S. dollar index gave additional support to gold. The measure of the dollar against a basket of other major currencies rose above 99 again on Wednesday.
Gold and the dollar typically move in opposite directions. If the dollar goes up, dollar-priced gold futures will become more expensive for investors holding other currencies.
Market analysts said that profit-taking also pressured gold furures, which had rallied to seven-year highs amid growing risk-off sentiment.
As for other precious metals, silver for May delivery was down 35.4 cents, or 1.94 percent, to close at 17.914 dollars per ounce. Platinum for April delivery fell 17.50 dollars, or 1.88 percent, to settle at 914.80 dollars per ounce. Enditem