Futures Market News
Gold futures dive as dollar gains after euro zone political tumult
May 08, 2012 12:38 PM
The yellowish metal lost as much as $40 per troy ounce and was hovering about the milestone price of $1,600 in the aftermath of weekend elections in the euro zone that caused havoc, The Wall Street Journal reports.
The leaders of the region's two top economic powers - Germany and France - are projected to disagree on the best strategies to prompt growth and deal with the sovereign debt crisis. Socialist Francois Hollande prevailed over Nicolas Sarkozy in France, upsetting the nation's strong relations with German chancellor Angela Merkel.
"What we've seen in recent weeks is rallies have been increasingly weaker on the upside, and that is a warning that we are going to see another test on the downside," analyst Daniel Smith with Standard Chartered told Reuters. "Gold didn't benefit from the latest European problems and part of that is the U.S., which has been outperforming relatively speaking, so that is handing the dollar strength."
At 11:57 a.m. on Tuesday, gold futures dropped 2.27 percent, a $37.20 loss to $1,601.90 per troy ounce.
Don’t Miss Our News Updates!
Follow our breaking news stories and get a unique take on current events that may impact the commodity futures markets. Multiple new articles are posted each weekday. Subscribe to our commodity news updates by email, and receive real-time updates with our RSS feed, follow us on Twitter @DanielsTrading, become a fan on Facebook to stay informed.
SPECIAL OFFER: Free eBook — Gold Exposed: Spot Gold versus Gold Futures
Are you interested in trading gold futures but unsure of how to start?
Register for our FREE guide, and learn the ins and outs of the gold markets that will help answer many of your trading questions.
Register for Your Free 2-Week Trial of the dt Insider Market Advisory!
With your free trial membership, you'll receive full access to our exclusive trade recommendation service and all of the timely and accurate trade information you need to feel comfortable participating in the markets.