Gold prices turned slightly negative on Monday, reversing gains of 1 percent on pressure from strong crude futures and US equity markets. Spot gold was down 0.05 percent at $1,272.50 an ounce at 2:07 pm EDT (1807 GMT), after rising as much as 1.2 percent to $1,288.20. US gold futures for June delivery settled up 0.1 percent at $1,274.20 an ounce.
Bullion prices were initially supported by lower stock markets and soft Chinese data, which boosted interest in the metal as an alternative asset. Gold prices sharply pared gains, by more than $4 in just two minutes from 10:30-10:32 am EDT (1400-1432 GMT), as Wall Street turned higher. "This whole drop in gold centers around equity markets," said Bob Haberkorn, senior market strategist for RJO Futures in Chicago. "At the same time stocks started rallying, and popped pretty quick, gold fell." Gold is up 20 percent this year after weak economic data in the United States and elsewhere tempered expectations of a near-term increase in US interest rates, which would lift the opportunity cost of holding non-yielding gold. Among other precious metals, silver was up 0.2 percent at $17.12 an ounce, platinum was flat at $1,047 and palladium was up 0.1 percent at $589.80 an ounce. The palladium market may need up to three years to consume its opaque above-ground stocks, according to Russia's Norilsk Nickel, the world's largest producer of the metal.
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