Investing.com – Gold futures padded gains to a one-month high in Asian trade Wednesday, as investors looked to European leaders for a debt crisis solution but with enough skepticism of a resolute deal being brokered to lift safe-haven precious metals.
On the Comex division of the New York Mercantile Exchange, gold futures for December delivery traded at USD1,702.85 a troy ounce during early Asian trade, gaining 0.15%, after hitting a low of USDS1,696.55.
Leaders from 27 European countries were scheduled to meet in Brussels later Wednesday, followed by a meeting between heads of the 17-nation euro-zone. Finance officials were to meet at an as-yet undetermined later date to work out the details of whatever scheme is agreed upon.
At the heart of the debate is an expansion of the European Financial Stability Facility, the USD603 billion rescue fund for debt threatened euro-zone nations. France has pressed for additional funding from the European Central Bank while Germany has argued that such an approach would undermine the independence of the ECB.
Adding fuel to safe-haven purchases, the meeting of European Union finance officials scheduled to take place before the summit was cancelled.
In Tuesday trade, Wall Street shares sagged on a disappointing third-quarter earnings report from Amazon.com Inc. The Dow Jones Industrial Average fell 1.74% to 11,706.60, the Nasdaq Composite Index surrendered 2.26% to 2,638.42, and the S&P 500 gave up 2% to end the day at 1,229.05.
Earlier in the day, the Conference Board reported that U.S. consumer confidence fell by 6.8 points to 39.8 in October, down from 46.6 in September. Market expectations were for the index to drop by 0.6 points to 46.0 for the period.
Meanwhile German financial provider Commerzbank noted in a report that “concerns about the European debt crisis and the risk of contagion are leading to renewed investor demand for golf for wealth-preservation purposes.”
A higher dollar helped to provide top-side resistance for gold futures, as a stronger greenback makes gold futures purchases more expensive for holders of other currencies.
The dollar index, which tracks the performance of the greenback versus a basket of six other major currencies, was up 0.06% to 76.44.
On the Comex, silver for December delivery retreated 0.15% to trade at USD33.00 a troy ounce, while copper for December delivery edged down 0.14% to trade at USD3.406 a pound.