Gold Down As Equities Rally on QE

Gold.......
Gold futures are trading lower as the equities cheered taking the Japanese stocks toward fresh multiyear highs on indication that the Federal Reserve Bank wasn’t close to slowing its asset purchases.
The rally in equity market has recently taken away the shine from gold as investors have taken away their money from gold and other commodities and have invested in the stock market.
U.S. stocks rose on Tuesday, with the Dow industrials and S&P 500 finishing at record highs, after comments from two Federal Reserve officials suggested that the central bank is not close to tapering its bond-buying program. The Dow Jones Industrial Average gained 52.30 points, or 0.3%, to end at 15,387.58, notching its 19th consecutive Tuesday rise. The S&P 500 index climbed 2.87 points, or 0.2%, to 1,669.16,
In Asia, the Nikkei Stock Average, which ended at multiyear highs in each of the last three trading sessions, climbed a further 1.1% to 15,555.82, while the broader Topix added 0.8%.
Gold for June delivery is trading down $2 at $ 1375 an ounce on the Comex division of the New York Mercantile Exchange. It shed $6.50, or 0.5%, to settle at $1,377.60 an ounce, paring losses that had taken prices to a low below $1,360.
On Tuesday, St. Louis Fed President James Bullard said the central bank should continue with its present bond-buying program and adjust the rate of purchases in view of incoming data on growth and inflation. In a separate speech, New York Fed President William Dudley said he’s not sure which way the Fed will adjust the size of its bond-purchase program.
The program has helped support gold as quantitative easing tends to pressure the dollar and can lead to inflation. Gold is often seen as a hedge against inflation.
Fed Chairman Ben Bernanke on Wednesday will testify before the Joint Economic Committee about the central bank’s economic outlook and the FOMC will release minutes from its most recent policy meeting.
MCX June gold futures may open today’s session near Rs 26100 levels with resistance near Rs 26200-300 and support near Rs 25950.
Source by Commodity Insights