Gold ends below $1,300 on stronger dollar, equities


Gold settled lower on Thursday as robust economic data from the United States, China and the euro zone deterred investors from buying into safe-haven assets.

U.S. gold futures finished the trading session $13.90 lower at $1,290.80 an ounce, after stop-loss orders were placed by traders below $1,300 to limit losses, prompting further selling. Spot gold fell 1.1 percent to its lowest since June 19 at $1,290.40 an ounce.

"The dollar is a bit bid after good jobs and housing data, equity markets are also stronger and that is all weighing on gold," MKS SA head of trading Afshin Nabavi said. "We saw some stop-losses as we broke $1,300 and there will be more if we take out the $1,286 area."

The dollar was up 0.1 percent against a basket of main currencies, erasing earlier losses after data showed the number of Americans filing new claims for unemployment benefits fell to the lowest level in nearly 8-1/2 years.

Gold / US Dollar Spot

Strong employment reports out of the United States over the past month have stoked speculation of an early interest rate increase. Higher rates could encourage investors to switch to assets that, unlike gold, pay interest.

Other data showed contracts to buy previously owned U.S. homes hitting an eight-month high, the latest indication that housing is pulling out of a recent soft patch.

The metal was also under pressure from stronger equity markets after signs of improving economic conditions in Europe and China.

Gold had seen support build around the $1,300 level, after deepening violence in the Middle East and Ukraine burnished its appeal as an insurance against risk.

Holdings of the SPDR Gold Trust, the world's largest gold-backed exchange-traded fund, rose for a second straight day on Wednesday, up 0.6 tons to 805.44 tons.

--By Reuters. For more information on precious metals, please click here.