Gold prices are falling for a second day as investors take their money out of precious metals and put it back in to the riskier stock market.
The Dow Jones industrial average gained about 1 percent in late trading. Higher stock prices Friday also led to gains in industrial metals like platinum and copper. A strengthening stock market signals that future demand might not be as weak as some traders thought earlier this week.
The markets were cheered by news that consumer spending improved last month, with retail sales rising 0.5 percent. The Commerce Department said consumers spent more on autos, furniture, clothing and gas in July, making it the best showing since March. The agency also revised sales higher in the previous two months.
If demand rises, so will orders for raw materials at the world's factories. Silver, which is both a precious metal and industrial ingredient, was also up.
"The retail sales, excluding autos, were all greater than expected," said Catherine Virga, an analyst with CPM Group in New York. "It would indicate improving economic growth and it is supporting confidence in the market."
September palladium rose $14.40 to $748.20. Copper for September delivery gained 0.35 cents at $4.012 per pound.
October platinum added $4.30 to end at $1,796.70. September silver gained 44.5 cents to end at $39.114 an ounce.
Gold for December delivery, on the other hand, fell $8.90 to $1,742.60 an ounce. Gold had rallied earlier in the week, hitting a new record just above $1,800 an ounce before backing off those highs.
Gold prices started falling Thursday after investors felt more comfortable buying stocks. The price was also hurt after the CME Group trading exchange raised its margins requirements for gold contracts. The move requires investors to back up their best on the gold market with more cash.
In other trading, crop prices were up in the wake of a government report that predicts tight backup supplies of corn and other crops through next year.
Corn for December delivery rose 0.5 cents to settle at $7.145 per bushel. Wheat for September delivery rose 1.25 cents to finish at $7.025 per bushel. November soybeans added 3 cents to finish at $13.3475 per bushel.
In energy trading, oil prices closed slightly lower on uncertainty over future demand. Oil prices had risen through the afternoon along with the stock market, but fell in late afternoon trading to close down 34 cents.
Oil prices have bounced from a low of $79.30 to a little more than $86 a barrel this week as investors remain concerned about global economic growth. Traders recently have based their decisions buying and selling contracts largely on economic news and shifts in the stock markets.
Benchmark crude for September delivery fell 34 cents to finish at $85.38 per barrel on the New York Mercantile Exchange.
Heating oil gained 0.45 cents at $2.9037 per gallon. Gasoline futures fell 0.51 cents to $2.8222 per gallon and natural gas lost 4.8 cents to end at $4.06 per 1,000 cubic feet.