Copper, silver, gold plunge on economic worries

AP News
Posted: Sep 23, 2011 4:21 PM
Copper, silver, gold plunge on economic worries

Copper, silver and gold led a broad sell-off in commodities Friday as worries lingered about the lagging pace of the global economy.

The concerns are focused on the U.S. economy, Europe's struggle with sovereign debt issues and slower growth in China. Future demand for commodities such as copper and other manufacturing metals, oil and agriculture products is unclear.

Many investors sold holdings for cash, to cover losses in other financial markets or to stay on the sidelines during weekend meetings planned by the International Monetary Fund and World Bank, analysts said.

Gold for December delivery fell $101.90, or 5.9 percent, to finish at $1,639.80 an ounce. The price has fallen 9.6 percent in the past week but remains 16.1 percent higher since the first of the year.

"I'm kind of surprised by the amount of selling we've seen in this market," Kingsview Financial analyst Matt Zeman said. "People just want cash, period."

He and other analysts say gold prices could continue to fall until there is a better idea of what's next for the economy.

December silver fell $6.477, or 17.7 percent, to end at $30.101 an ounce. CPM Group analyst Carlos Sanchez noted that silver is traded both as a safe-haven asset and for its industrial uses. The market is smaller than gold so price swings are more volatile.

December copper fell 20.85 cents, or 6 percent, to finish at $3.28 per pound and October platinum fell $97.40, or 5.7 percent, to $1,613.20 an ounce. December palladium fell $21.55, or 3.3 percent, to $642.50 an ounce.

In other trading, benchmark oil dropped 66 cents to finish at $79.85 per barrel on the New York Mercantile Exchange. Heating oil fell 5.2 cents to $2.8059 per gallon, gasoline futures fell 1.93 cents to $2.5244 per gallon and natural gas fell less than a cent to finish at $3.701 per 1,000 cubic feet.

September wheat fell 7 cents to end at $6.4075 per bushel, corn dropped 11.5 cents to $6.385 per bushel and soybeans fell 25 cents to finish at $12.58 per bushel.