Aug. 5 (Bloomberg) -- Gold fell for the second straight day on sales by some investors to cover losses in other markets. Silver slumped, capping the biggest weekly drop in three months.
U.S. equities, which erased earlier losses today, headed for the biggest weekly decline since March 2009. Yesterday, gold rose to a record $1,684.90 an ounce as global economic concerns and the sovereign-debt crisis in the U.S. and Europe sent yields on two-year Treasuries to a record low.
“It’s a volatile period for gold,” Adam Klopfenstein, a senior strategist at MF Global Holdings Ltd. in Chicago, said in a telephone interview. “You would think that people would buy gold as a haven now, but they’re selling it because they need to raise cash.”
Gold futures for December delivery fell $7.20, or 0.4 percent, to settle at $1,651.80 at 1:45 p.m. on the Comex in New York. Earlier, the metal rose as much as 0.8 percent.
This week, the price climbed 1.3 percent, the fifth straight gain. The commodity has gained 38 percent in the past year as nations hampered with debt and sluggish economies were forced to keep borrowing rates low.
Dennis Gartman, an economist and the editor of the Suffolk, Virginia-based Gartman Letter, recommended that clients cut their gold positions by half.
“Given the circumstances prevailing in a world that shall put a premium high upon liquidity, we think it is wise to liquidate our gold holdings ahead of everyone else,” Gartman said in the report. “The highs seen yesterday shall not be taken out for quite some long while.”
Silver futures for September delivery tumbled $1.22, or 3.1 percent, to $38.211 an ounce on the Comex, capping a two-day slump of 8.5 percent. This week, the metal dropped 4.7 percent, the most since early May.
Palladium futures for September delivery fell $11.20, or 1.5 percent, to $741.75 an ounce on the New York Mercantile Exchange. Earlier, the metal touched $722.15, the lowest since June 27. This week, the price tumbled 10 percent, the most since July 2010.
Platinum futures for October delivery declined $10.30, or 0.6 percent, to $1,719.10 an ounce. This week, the price dropped 3.7 percent.
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