gold closed at a three-week high on tuesday, as investors continued to stock up following a recent pullback. gold for december delivery settled up 0.8% at $1,273.60 a troy ounce on the comex division of the new york mercantile exchange, closing at the highest level since october 3. the drop in gold prices over the past few weeks has brought some buyers back into the market, traders said. gold was also supported by a weaker economic outlook on tuesday, after the conference board said its index of consumer confidence fell to 98.6 in october from 103.5 in september, falling short of economist expectations. <u+201c>you<u+2019>re seeing a flight to safety,<u+201d> said bob haberkorn, senior market strategist at rjo futures. as gold prices have drawn closer to $1,250 an ounce, <u+201c>there<u+2019>s some life that steps in<u+201d> to the market, he said. earlier this month, a run of strong u.s. economic data strengthened the case for the federal reserve to raise interest rates this year . the prospect of higher rates has sapped the appeal of commodities that don<u+2019>t pay interest and pushed gold below $1,300 an ounce. nitesh shah, commodities strategist at etf securities, said demand had remained resilient since the selloff. he said some investors were speculating that the market had fallen too far in anticipation of higher rates and an actual increase might be followed by a rebound. he added that the impending u.s. presidential election was also likely providing some support for the commodity, which is seen as a haven, as investors seek to insure portfolios against a victory for republican nominee donald trump, a result that could rattle financial markets. <u+201c>as that date [nov. 8] approaches, people are making sure they<u+2019>ve got these hedges in their portfolio, just in case,<u+201d> mr. shah said. analysts at ubs said they would be monitoring flows in and out of exchange-traded funds that purchase gold, after friday saw a large net outflow of 518,000 ounces. that reduction -- the biggest one-day decline since july 2013<u+2014>marked a change from the recent pattern of resilient inflows into etfs. with the london gold price little changed since its close friday, ubs noted that the market <u+201c>seems to have taken [friday<u+2019>s] selling quite well for now.<u+201d> but there is a risk that etf buyers who entered the market at higher levels could get <u+201c>spooked<u+201d> and start selling, ubs said. <u+201c>etf selling presents risks to the market -- the key question right now is whether the chunky selling on friday was a one-off or if outflows would continue in the days ahead,<u+201d> ubs said. write to stephanie yang at stephanie.yang@wsj.com and ed ballard at ed.ballard@wsj.com
gold prices rise on dimmer economic outlook  - wsj
ed ballard