Gold struggles as stronger equities hurt safe-haven appeal
By A. Ananthalakshmi
SINGAPORE (Reuters) – Gold steadied on Monday but failed to make any recovery from three straight days of losses as stronger global economic data and higher equities curbed the metal's safe-haven appeal.
Asian equities rose on Monday, taking heart from upbeat U.S. economic data and slightly better-than-expected health checks on euro zone banks, which helped revive investors' risk appetite.
"In addition, the ECB stress test which gave most of its 130 banks a clean bill of health may continue to dampen safe-haven demand in gold. All these, and accounting for the relatively stronger greenback for the past month, should continue to inject downside risk for bullion," Gan said.
Spot gold slipped 0.1 percent to $1,229.73 an ounce at 0639 GMT – not too far from a one-week low of $1,226.17 reached last week.
The metal's losses come after global equities posted their biggest weekly percentage gain since July 2013 last week, while the U.S. dollar also strengthened.
Data on Friday showed that new U.S. home sales rose to a six-year high and Britain's economy expanded 0.7 percent in the third quarter, easing fears over a global slowdown. Strong corporate earnings also helped push equities higher.
Bullion traders were also closely watching investors' positions in gold funds. SPDR Gold Trust, the world's largest gold-backed exchange-traded fund, said its holdings fell 0.6 percent to 745.39 tonnes on Friday.