Gold ticks up on bargain hunting

Gold futures on the COMEX Division of the New York Mercantile Exchange bounced off its 3-month lows and ended moderately higher on Wednesday, as some bargain hunters stepped in and bought the precious metal after gold's sell-off on Tuesday. Silver extended losses and platinum rose.

The most active gold contract for August delivery rose 2.4 dollars, or 0.2 percent, to finish at 1,160.4 U.S. dollars per ounce.

The U.S. Commerce Department said on Wednesday that the durable- goods orders fell 1 percent in June to a seasonally adjusted 190.5 billions dollars, much lower than economists' expectation of a 1.1- percent rise, which was the largest decline in total orders since August 2009.

Gold received some support and steadied earlier in the session, as the unexpected drop in durable goods orders dampened market optimism over the economic recovery, and let a few market players dial down their risk appetite.

Traders noted that the strong demand from the largest gold jewelry market, India, was one of the main factors behind gold's rally on Wednesday, while the weaker dollar also added upward pressure on gold's price.

The gold price reached record highs in May and June, supported by the persisting fear that global economic growth remained vulnerable to sovereign debt risks and the possibility of a double- dip recession. But the most-active gold contract lost 6.9 percent in July, pressured by the recent stability in the European and U.S. markets.

A few bargain buyers came back to gold markets after the price plunged 2.1 percent in the previous session, but many believe there's still room for an extended correction, as demand for safe- haven assets remained low.

September silver lost 18.5 cents, or 1.0 percent, to settle at 17.441 dollars per ounce. October platinum added 5.0 dollars, or 0. 3 percent, to settle at 1,541.7 dollars per ounce.

Source: Xinhua