Markets see gold slide amid silver gains

London: Gold fell as some investors sold the precious metal on speculation a rally to the highest price in more than a week was overdone. Silver advanced.

Gold touched $866.60 (Dh3,181.92) an ounce on Tuesday, extending a rally in New York that began January 16 to a 5.9 per cent gain, the most in two sessions since mid-December. Investment in the SPDR Gold Trust, the biggest exchange-traded fund backed by bullion, reached a record 802.9 metric tons on Tuesday. Gold rose 5.5 per cent in 2008 for the eighth-straight annual gain.

"Gold's covered a lot of ground recently," said Matt Zeman, metals trader at LaSalle Futures Group in Chicago. "We saw prices rise dramatically so the rally was a bit overdone and a little profit taking is expected."

Gold futures for February delivery fell 0.1 per cent, to $854.20 an ounce on the Comex division of the New York Mercantile Exchange.