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June 13 (Bloomberg) -- Gold dropped to a three-week low on sales by some investors to cover losses in equity markets.
The MSCI All-Country World Index of stocks touched the lowest in more than two months. The Standard & Poor’s 500 Index has fallen for six straight weeks. Gold reached a record $1,577.40 an ounce on May 2.
“Gold may tumble if margin-call problems should arise in equities here and abroad,” said Dennis Gartman, an economist and the editor of the Suffolk, Virginia-based Gartman Letter.
On the Comex in New York, gold futures for August delivery fell $13.60, or 0.9 percent, to settle at $1,515.60 at 1:53 p.m. Earlier, the price touched $1,511.40, the lowest for a most-active contract since May 23.
Last week, the metal dropped 0.9 percent, the first decline since early May. The commodity has climbed 6.6 percent this year.
“Momentum has taken a step back in the wake of gold’s failure to overcome $1,550 last week,” Edel Tully, a London-based analyst at UBS AG, said in a report.
U.S. Payrolls grew at the slowest pace in eight months in May, according to Labor Department figures released June 3. Other data show manufacturing has slowed and the economy is decelerating. Crude oil fell as much as 3.2 percent today, trading under $100 a barrel.
“People are ditching risk,” said Matt Zeman, a market strategist at Kingsview Financial in Chicago. “When oil started breaking down, it dragged everything down with it. The fact that everything continues to point to a slowdown is a negative for commodities.”
The Thomson Reuters/Jefferies CRB Index of 19 commodities fell as much as 1.5 percent.
Silver futures for July delivery fell $1.59, or 4.4 percent, to $34.737 an ounce on the Comex. Earlier, the price touched $34.55, the lowest since May 23.
Palladium futures for September delivery dropped $16.95, or 2.1 percent, to $800.35 an ounce on the New York Mercantile Exchange. Platinum futures for July delivery fell $26.20, or 1.4 percent, to $1,806.80 an ounce on Nymex.
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