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Gold Weaker on Sell-Off to Cover European Losses

Gold is falling in morning trade as investors continue to take advantage of the yellow metal's record highs posted last week. The rapid decline in European equities and the euro too have spurred many traders to sell off gold to cover their losses in the bourses.

Nevertheless, many investors remain upbeat about gold's longer-term prospects, especially as worries about the euro zone continue. German Chancellor Angela Merkel's temporary ban on naked speculative trading has unsettled markets, and is seen pushing demand for a safe haven moving forward.

At 0815 ET, gold is 0.7% weaker at $1,206.50 an ounce, while silver is nearly 2% lower at $18.51 an ounce, and copper is down 2.9% at $2.95 a pound.

Palladium and platinum too are falling as worries that Europe's shaky footing will hurt industrial demand and global economic recovery for some time.

On the corporate front, Canada's Barrick Gold Corp.'s ( ABX ) North America unit spent $216,000 in the first quarter to lobby the U.S. government on mining reform and taxes through the National Mining Association. The White House is looking to overhaul the 1872 mining law that gives mining preference over other uses on much of public land.

As for Australia's Signature Metals Ltd ( SBL ), it said it would raise up to 5 million Australian dollars through a 250 million share placement at 2 cents a share. The funds will be used to recommission its carbon-in-leach plant, and move its Ghanaian gold project in Kanongo into production to generate a cash flow.

Randgold Resources Ltd. ( GOLD ) sold 5 million common shares in Volta Resrouces Inc. ( VTR ) for 1.59 Canadian dollars per share for 7.95 million Canadian dollars. The cash will be used for general corporate purposes. Randgold had acquired 20 million shares in Volta in November 2009.

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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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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