Gold Extends Gains Amid Drop in Stock Markets

Gold prices extended its gains to more than $34 during Tuesday's trading with the weakening of the US currency, and amid yesterday's drop in US stock markets.

Economic data revealed a decline in industrial activity in the United States by more than analysts' expectations, pushing the yellow metal to recover from its lowest level in 5 months after strong losses in October.

Gold fell by about 5.6% during November, in the largest monthly loss in 4 years due to the hopes of a coronavirus vaccine.

In pre-prepared statements, Chair of the Federal Reserve Jerome Powell said that the United States is entering a "challenging" month as a potential pandemic vaccine faces production and distribution challenges before its economic impact becomes relevant.

Meanwhile, the United States recorded 10,000 deaths from the Coronavirus and more than 1.1 million new cases last week.

By the end of trading, the price of gold futures contracts for February delivery rose 1.9% or $34.60 to reach $1815 an ounce, while the spot price of the yellow metal also rose by 1.8% or $31.20 to record $1808.

During the same period, the main dollar index, which measures the performance of the currency against 6 major currencies, fell by 0.2% to 91.66.

Down 15.8% from August's record high, that was a new all-time high for gold currency when first reached in mid-July.