GOLD MAY FALL IN LONDON AS SOME INVESTORS SELL TO COVER LOSSES

Gold, little changed in London, may decline as some investors sell the metal to cover losses on other assets. Platinum, palladium and silver all fell.


The euro slid against the dollar after the International Monetary Fund urged Spain to do more to overhaul its ailing banks,adding to speculation that European financial institutions may face greater losses.All six industrial metals on the London Metal Exchange dropped, as did oil and global equities. Holdings in the biggest gold-backed exchange-traded fund rose to a record.




Gold is “vulnerable to further cash-generating selling in the short-term given the volatile swings across the broader financial markets,” James Moore, an analyst at TheBullionDesk.com in London, wrote in a report. Increasing ETF holdings and coin and bar purchases continue to “highlight investor diversification towards safe-haven asset types and should limit the impact of long liquidation in gold.”


Gold for immediate delivery lost $3.40, or 0.3 percent, to $1,188.25 an ounce at 11:36 a.m. in London. Bullion for June delivery was 0.5 percent lower at $1,188.10 on the Comex in New York.


Gold rose to $1,189.50 an ounce in the morning “fixing” in London, used by some mining companies to sell production, from $1,187 at yesterday’s afternoon fixing. Spot prices are up 8.3 percent this year, heading for a 10th annual gain.


"We fear that commodity prices are about to come under very real pressure as a result” of a stronger dollar and falling equity markets, said Dennis Gartman, an economist and editor of the Suffolk, Virgina-based Gartman Letter. “This shall be especially true if the margin clerks begin to sharpen their knives as share prices weaken, for they will begin to look for any and all places from which to get liquidity.”