Investing.com - Gold futures dropped on Monday as fears the euro zone's periphery is facing a banking crisis faded, which enticed investors out of safe-haven positions in the yellow metal and into global stock markets.
On the Comex division of the New York Mercantile Exchange, gold futures for August delivery traded at 1,306.20 a troy ounce during U.S. trading, down 2.33%, up from a session low of $1,304.10 and off a high of $1,340.70.
The August contract settled down 0.13% at $1,337.40 on Friday.
Futures were likely to find support at $1,258.00 a troy ounce, the low from June 17, and resistance at $1,346.80, Thursday's high.
Gold prices recently shot up on safe-haven demand after the parent company of Portugal's largest bank, Banco Espírito Santo, said last week that it missed commercial paper payments.
The announcement rattled nerves across the globe, fueling concerns surrounding the soundness of the banking sector in Portugal as well as in Spain and Italy.
On Monday, gold dropped after the bank as well as Portuguese government and monetary authorities assured the world the country's financial system is not in crisis.
Meanwhile in the U.S., stocks rose on hopes for upbeat earnings this week, which also chipped away at gold's use as a hedge.
Meanwhile, silver for September delivery was down 2.51% at $20.923 a troy ounce, while copper futures for September delivery were down 0.63% at $3.248 a pound.