Daily Gold Update

Source: Marketwatch

San Francisco— Gold futures advanced 1.7% Tuesday, regaining the $1,800-an-ounce mark as bargain hunters returned to the metal, fears remained about Europe�s sovereign-debt crisis, and investors expected the U.S. Federal Reserve soon to announce steps to improve the economy. Gold for December delivery rose $30.20, or 1.7%, to settle at $1,809.10 an ounce on the Comex division of the New York Mercantile Exchange. �There�s some move to safety� as Europe�s sovereign-debt crisis continues, said Tom Pawlicki, analyst with MF Global in Chicago. Investors were also factoring in some announcement of economic stimulus on Wednesday, when the Fed concludes its two-day policy meeting. The expectation of more stimulus touches on fears of fiscal profligacy, one of the pillars of gold investing.

The contract fell $35.80, or 2%, on Monday to finish at its lowest level in more than three weeks as a stronger U.S. dollar pressured commodity prices, and investors were also biting back into the market after the retreat. Late Monday, Standard & Poor�s Ratings Services cut Italy�s long-term credit rating, to A from A-plus. It also cut its short-term rating to A-1 from A-1-plus, citing a weak economic outlook and prospects for ongoing political gridlock. The rating cut �doused cold water over Italy�s capacity to address their public finances,� analysts at GoldCore said in a note to clients Tuesday. �As long as governments cower from their responsibilities to balance their budgets and continue to print money instead of paying their bills, gold will likely appreciate in paper money terms,� they said. See full story.