Gold prices settled lower on Tuesday, as economic optimism and another intraday record high in U.S. equities sapped bullion's safe-haven appeal.
The precious metal fell for a fourth consecutive session. It erased earlier gains after the S&P 500 index rallied about 1 percent on broad gains in shares in banks and financial institutions.
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Credit-rating agency Fitch's upgrade on Greece's sovereign debt also dent gold's appeal as a hedge against economic uncertainty.
A halt in the liquidation in exchange-traded funds after months of hefty outflows, and strong physical demand in coins and bars around the world after the mid-April selloff provided underlying demand.
Analysts cited Akshaya Tritiya, a key gold-buying Hindu festival on Monday, for a near-term boost to bullion prices.
"We expect Indian gold demand to remain at elevated levels with the festive gold-buying wedding season under way," said James Steel, chief precious metal analyst at HSBC.
Gold fell 0.3 percent to $1,425.61, having earlier risen by 1 percent to a session high of $1,444.96.
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The metal hovered just above its two-week low of $1,420.61 set on Friday. It has faced the headwinds of a stronger dollar against the yen and the euro over the past few sessions.
"Currency movements are clearly driving the market at the moment and then if you look at bond yields they are also moving higher, indicating that investors prefer to put their money in other assets," Credit Suisse analyst Karim Cherif said.
U.S. gold futures settled down $9.80 to $1,424.50 an ounce, with trading volume on track to finish near its 30-day average, preliminary Reuters data showed.
Gold has recovered about half of its losses after a sell-off in mid-April dragged prices to more than two-year lows at $1,321.35, but it is still well below April's high of around $1,600, as investors shifted into equities and cut exposure to bullion.
SPDR Gold Holdings Unchanged
Holdings of SPDR Gold Trust, the world's largest gold-backed exchange-traded fund, stood unchanged on Monday after a string of heavy outflows, raising hopes that gold ETF liquidation might have finally finished, analysts said.
The fall in gold prices last month led to a surge in physical buying in Asia and elsewhere, helping to pluck prices off lows, but physical demand for some gold products began to subside.
"While gold coin sales have been brisk, undoubtedly helping the recent recovery, we have to suspect that the 'bargain-buying' off the lows has decelerated somewhat after the initial spurt," said Edward Meir, a metals analyst at futures brokerage INTL FCStone.