Gold Ends Lower On Upbeat U.S. Data

(RTTNews) - Gold futures extended losses for a second straight session to end lower on Friday, tracking rising global equity markets after some upbeat economic data from the U.S.

Nevertheless, persisting worries over eurozone growth appear to be limiting the precious metal's downside, despite easing concerns about the health of the U.S. economy.

After yesterday's impressive reports on U.S. initial jobless claims and industrial production, the market got another boost today with a report from the Commerce Department showing a more than expected increase in U.S. housing starts.

An encouraging report from Reuters and the University of Michigan showed U.S. consumer sentiment to have improved in October, rising to its highest level since July of 2007.

Despite the modest pullback, gold remains up sharply in October, its safe haven appeal boosted by growing concerns about the global economy and a meltdown in stocks.

Gold for December delivery, the most actively traded contract, dropped $2.20 or 0.2 percent to settle at $1,239.00 an ounce on the Comex division of the New York Mercantile Exchange on Friday.

Gold for December delivery scaled an intraday high of $1,242.10 and a low of $1,232.00 an ounce.

On Thursday, gold ended lower by $3.60 or 0.3 percent with its safe haven appeal waning after some positive economic data from the U.S. as global equity markets rebounded.

Holdings of SPDR Gold Trust, the world's largest gold-backed exchange-traded fund, inched up to 760.93 tons on Friday, from its previous close of 759.14 tons on Thursday.

The dollar index, which tracks the U.S. unit against six major currencies, traded at 85.10 on Friday, up from its previous close of 84.96 late Thursday in North American trade. The dollar scaled a high of 85.25 intraday and a low of 84.76.

The euro trended lower against the dollar at $1.2777 on Friday, as compared to its previous close of $1.2809 late Thursday in North American trade. The euro scaled a high of $1.2836 intraday and a low of $1.2746.

In economic news from the U.S., a report from the Commerce Department showed housing starts increased by a more than expected 6.3 percent to a seasonally adjusted annual rate of 1.017 million in September, after tumbling 12.8 percent to a rate of 957,000 in August. Economists had expected housing starts to rise to a rate of 1.008 million.

Building permits rose 1.5 percent to a rate of 1.018 million in September.

Consumer sentiment in the U.S. improved unexpectedly in October, a report from Thomson Reuters and the University of Michigan showed Friday. A preliminary reading on the consumer sentiment index for October came in at 86.4 compared to the final September reading of 84.6. Economists expected the index to edge down to a reading of 84.0.

The eurozone economy grew more than previously estimated in the second quarter, latest estimates under the new ESA 2010 rule showed. Gross domestic product grew 0.1 percent sequentially in the second quarter, the Eurostat reported. The ESA 95 based estimation had showed a flat growth for the second quarter.

The annual growth for the currency bloc was revised to 0.8 percent in the second quarter from 0.7 percent.

Separately, data from Eurostat showed eurozone construction output to have increased at a faster pace in August. Construction output advanced 1.5 percent month-on-month following a 0.3 percent rise in July. Building output was up 1.4 percent and civil engineering advanced 2.1 percent.