GLOBAL MARKETS-Gold tumbles; shares flat on fiscal cliff tension
* Gold drops to near 4-month low on year-end selling * Wall Street flat amid stalemate in fiscal talks * IntercontinentalExchange buys NYSE Euronext for $8 billion * Euro drifts lower vs dollar By Angela Moon NEW YORK, Dec 20 (Reuters) - Gold prices tumbled to an almost four-month low on Thursday on a burst of year-end selling, while global shares were little changed as the lack of progress in talks to avert the U.S. "fiscal cliff" kept buyers on hold. In the currency market, the euro edged lower against the dollar in volatile trading as the worries over the budget negotiations in Washington outweighed generally positive U.S. economic data that earlier investors' appetite for risk. Republicans in the House of Representatives pushed ahead with their own budget plan on Thursday, one that President Barack Obama has said he would veto. Gold prices fell more than 1 percent, after breaking through its 200-day moving average, which is considered a critical support level. Spot gold was down 1.08 percent at $1,648.59 an ounce at 1517 GMT, after hitting a low of $1,646.94. U.S. gold futures for December delivery were down 0.98 percent to $1,651.40. Prices were on track for their biggest quarterly drop since the third quarter of 2008, with the announcement of a fresh round of usually bullion-friendly U.S. monetary easing last month resulting in only temporary gains. "There has been liquidation ahead of year-end. People have been taking money out of gold and investing in other assets," said Simon Weeks, head of precious metals at Scotia Mocatta. In the absence of news, said Anne-Laure Tremblay, a BNP Paribas analyst, there seemed to be little appetite for a sustained move higher due to expectations that a deal would still be reached in the U.S. budget talks. "This should be mildly positive for risk appetite," she said. FISCAL CLIFF TENSIONS On Wall Street, prices were little changed on worries that a budget deal would not come as soon as they had hoped. Republicans and the White House continued to parry over their competing budget plans, though both sides indicated they wanted to reach an agreement. U.S. House of Representatives Speaker John Boehner said he would keeping working with the president to try to reach an agreement. The absence of a significant sell-off shows "the market still believes that there will be an announcement of some sort. But as the clock is ticking, the most you're going to get is a stop-gap measure," said Quincy Krosby, market strategist at Prudential Financial in Newark, New Jersey. "At least in the posturing it looks as if there are ultimatums put on the table, which tends to box either side in," he added. MSCI's world equity index has risen steadily over the past five weeks on optimism that a budget deal would clear the way for stronger growth in 2013. It was steady near 342 points on Thursday, not far from levels last seen in July 2011. The Dow Jones industrial average was up 5.36 points, or 0.04 percent, at 13,257.33. The Standard & Poor's 500 Index was up 1.62 points, or 0.11 percent, at 1,437.43. The Nasdaq Composite Index was down 3.35 points, or 0.11 percent, at 3,041.01. The market barely reacted to a string of strong economic data. The U.S. Commerce Department said the economy grew faster in the third quarter than it had previously estimated, and an industry group reported that sales of existing homes surged to a three-year high in November. NYSE Euronext surged more than 30 percent and was the S&P 500's top percentage gainer after IntercontinentalExchange Inc said it would buy the operator of the New York Stock Exchange for $8.2 billion. NYSE was up 33 percent at $31.96, while ICE shares gave up early gains to fall 1.1 percent to $126.84. In Europe, shares stuttered as indexes approached levels considered overbought. The FTSEurofirst 300 closed virtually unchanged at 1,142.80 points. The 14-day relative strength index, a widely-used technical momentum indicator, stood at 67.5, close to the 70 and above level that is considered "overbought." The euro was down slightly at $1.3224 after trading higher for most of the session. On Wednesday, the euro hit an 8-1/2-month high. Still, market players were mostly positioned for a U.S. deal to be reached on time, with some expecting the euro to go as high as $1.3500 by early January. The dollar was flat against the yen at 84.36 yen. The Japanese currency had earlier slipped against the dollar after the scale of asset purchases set by the Bank of Japan disappointed some investors who had positioned for more aggressive easing. U.S. Treasuries prices rose as investors stuck to safe-haven government bonds. The benchmark 10-year U.S. Treasury note was up 6/32, with the yield at 1.784 percent.
- Police hunt for motive as search for Malaysian jet spans hemispheres |
- Crimeans vote over 90 percent to quit Ukraine for Russia |
- Ukraine, Russia agree Crimea truce until March 21-Ukraine minister
- Malaysian PM says lost airliner was diverted deliberately |
- Democrats seek ways to limit Obamacare fallout after Florida defeat