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Gold swings near 18-week low as U.S. optimism weighs

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Investing.com -

Investing.com - Gold prices swung between small gains and losses to hold near an 18-week low on Tuesday, as ongoing indications that the U.S. economy is shaking off the effects of a weather-related slowdown over the winter dampened appetite for the precious metal.

On the Comex division of the New York Mercantile Exchange, gold for August delivery traded in a range between $1,241.90 a troy ounce and $1,247.20.

Prices last traded at $1,245.00 during European morning hours, up 0.08%, or $1.00.

Gold fell to $1,241.10 on Monday, the lowest since January 31, before trimming losses to end at $1,244.00, down 0.16%, or $2.00.

Prices were likely to find support at $1,237.50 an ounce, the low from January 30 and resistance at $1,260.60, the high from May 30.

The Institute for Supply Management corrected its May manufacturing data twice on Monday. The index was first corrected to 56.0 after being initially reported as 53.2, before being corrected for a second time to 55.4.

The upbeat data underlined the view that the U.S. economy was regaining traction after being slowed by unusually cold temperatures during the winter months.

The precious metal has been under heavy selling pressure recently as investors bet on strong economic growth in the U.S. during the second quarter.

While data released last week showed that the U.S. economy contracted 1% in the first quarter, market analysts expects second quarter growth to snap back with a 3.8% gain.

Meanwhile, investors remained hesitant to buy into the market amid a weak technical outlook. Gold prices have declined for the past six consecutive sessions amid bearish chart signals.

Also on the Comex, silver for July delivery inched up 0.7%, or 13.1 cents, to trade at $18.87 a troy ounce.

Elsewhere in metals trading, copper for July delivery shed 0.53%, or 1.7 cents, to trade at $3.154 a pound as investors digested Chinese economic data.

Data released earlier showed that China's final HSBC Purchasing Managers Index came in at 49.4, down from a preliminary estimate of 49.7, but higher then April's final reading of 48.1.

A separate report showed that activity in the country's services sector improved to a six-month high in May.

The Asian nation is the world's largest copper consumer, accounting for almost 40% of world consumption last year.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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