Gold futures on the COMEX division of the New York Mercantile Exchange fell Monday as U.S. equities and the U.S. Dollar showed strength.
The most active gold contract for April delivery fell 20.7 U.S. dollars, or 1.68 percent, to settle at 1,210.10 dollars per ounce. Gold was put under pressure as the U.S. Dow Jones Industrial Average rose by 264 points, or 1.6 percent as of 1800 GMT.
Analysts noted that when equities post losses, the precious metal usually goes up, as investors are looking for a safe haven, while the opposite is true when U.S. equities post gains. The precious metal was put under further pressure as the U.S. Dollar Index rose by 0.75 percent to 97.49 as of 1800 GMT.
The index is a measure of the dollar against a basket of major currencies. Gold and the dollar typically move in opposite directions, which means if the dollar goes up, gold futures will fall as gold, measured by the dollar, becomes more expensive for investors.
Gold's fall was prevented from dipping further as the U.S. -based Institute for Supply Management showed its flash Purchasing Managers Index (PMI) report coming in Monday showing its February flash PMI measure at 51.0. Analysts noted that this report is much worse than expected, and shows weak orders and weak selling prices, in addition to being the lowest reading of this measure in three years.
Traders will be watching data carefully later this week, as the existing home sales report is due on Tuesday, new home sales and petroleum status report is due on Wednesday, durable goods and the weekly jobless claims report is due on Thursday, and finally on Friday, the gross domestic product report and personal income and outlays is due to be released.
Silver for March delivery dropped 18.9 cents, or 1.23 percent, to close at 15.184 dollars per ounce. Platinum for April delivery fell 17.8 dollars, or 1.88 percent, to close at 927.80 dollars per ounce.
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