Precious metals turn pale

Prices end near the daily low on a late-session downside move Bullion metal prices ended lower on Tuesday, 29 May 2012 at Comex. Prices ended the U.S. day session modestly lower and near the daily low on a late-session downside move. The U.S. dollar index rallied, the Euro currency slumped and crude oil prices weakened in the immediate wake of a credit rating downgrade for Spain. Gold for June delivery ended lower by $20.20 or 1.3%, to end at $1,548.7 an ounce on the Comex division of the New York Mercantile Exchange on Tuesday. Gold for August delivery, which is the most-active contract, fell $20.20, or 1.3%, to settle at $1,551 an ounce. On Tuesday, silver prices for July delivery ended lower by 60 cents or 2.1% at $27.79. In the currency market on Tuesday, the U.S. dollar index, which weighs the strength of the dollar against a basket of six currencies rose by 0.4%. Generally, a stronger dollar pressures demand for dollar-denominated commodities, such as crude oil and gold, which become more expensive for holders of other currencies and also vice versa. But bullions have registered increase in prices despite strong dollar in recent times and vice versa. The market place was tentative early Tuesday, following a long U.S. holiday weekend, and got more uneasy on the Eagan Jones credit downgrade for Spain. The Euro currency fell to a fresh nearly two-year low on the ratings downgrade news. The latest European Union debt and financial crisis developments also saw the large Spanish bank, Bankia, given significant bailout money over the weekend. There were also reports overnight that China is set to introduce fresh monetary stimulus measures to boost its economy. Such steps would be raw commodity market-bullish. Latest economic report at Wall Street showed that a gauge of U.S. consumer confidence declined for a third month, with gloomier views in May on present and future conditions. The Conference Board reported on Tuesday that the consumer-confidence index fell to 64.9 in May, the lowest level since January from a revised 68.7 in April. A prior estimate for April pegged the level at 69.2. Market had expected a reading of 70 for May. Precious metals traders and investors will continue to closely monitor U.S., EU and Chinese economic data for early clues on monetary policy actions from the central bank. At the MCX, gold prices for June delivery closed lower by Rs 106 (0.4%) at Rs 28,859 per ten grams. Prices rose to a high of Rs 29,135 per 10 grams and fell to a low of Rs 28,819 per 10 grams during the day's trading. At the MCX, silver prices for July delivery closed lower by Rs 387 (0.71%) at Rs 53,964/Kg. Prices opened at Rs 54,448/kg and fell to a low of Rs 53,790/Kg during the day's trading.