The gold price skidded on Tuesday, erasing earlier gains, after data showed that U.S. manufacturing conditions improved last month.
Gold for April delivery fell 0.2% to $1,232.80 an ounce at 12:02 p.m. on the Comex division of the New York Mercantile Exchange. The contract had advanced to as high as $1,249 earlier in the session, compared to Monday’s closing of $1,238.
An industry report showed on Tuesday that the U.S. manufacturing sector contracted for a fifth straight month in February but at a slower pace than January.
The Institute for Supply Management (ISM) index increased to 49.5% in February, about one point above forecast and surpassing January’s 48.2 print. A reading above 50 points to expansion in the manufacturing sector and a reading below 50 points to contraction.
One more report helped nudge down the gold price on Tuesday. The Commerce Department reported that construction spending rose a better-than-expected 1.5% in January.
U.S. stocks, on the other hand, are benefiting from Tuesday’s data, heading to halt two sessions of losses. The Dow Jones Industrial Average (DJIA) is up 1.4%, the S&P 500 rallied 1.8%, and the NASDAQ composite leaped 2.2%.
Also on the Comex on Tuesday, May Silver fell 0.8% to $14.79. Bucking the trend, April platinum rose 0.3% to $937.60, and palladium jumped 4.6% to $518.65.
Since the beginning of the year, gold has surged 16.0%; silver, 7.0%; platinum, 4.9%, while palladium is in negative territory with a 8.3% loss.