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Metals, including gold, fall on worries over Korea

Metals, including gold, fall on worries over Korea

November 27th, 2010 in News

NEW YORK (AP) - Gold and other metals fell Friday on uncertainty over North Korean war threats and also worries that more European nations like Spain and Portugal could need a bailout in the coming weeks.

"Whenever there's unease, people take money off the table," said George Gero, vice president of Global Futures at RBC Capital Markets. "There's too much uncertainty -- the possibility of bailout discussions with Portugal and Korean saber rattling."

Gold for February delivery fell $10.70 to close at $1,364.30 an ounce, while March silver contracts fell 83 cents to close at $26.77 an ounce.

Also Friday, China increased margins for futures traders as part of a wider government crackdown on commodity speculation. The Chinese government is trying to slow down growth after inflation grew at the fastest rate since 2008.

China is the largest consumer of industrial metals.

Palladium for December delivery fell $18.90 to settle at $676.50 an ounce. January platinum fell $13.20 to close at $1,645.20 an ounce and copper for March delivery was flat at $3.76 a pound.

North Korea warned Friday that plans by South Korea and the U.S. to stage military maneuvers have put the Korean peninsula on the brink of war. North Korea fired artillery shells at a South Korean island on Tuesday, killing four people.

Meanwhile in Europe, even as the details of Ireland's bailout were still being worked out, the markets fretted over the likelihood that both Portugal and Spain would also need a bailout.

On Friday, Portugal adopted a host of austerity measures aimed at reducing debt and restoring confidence in the markets. Leaders from both Spain and Portugal have said they won't need a bailout. However the markets were less convinced.

The 16-nation euro slumped another 0.8 percent on the day to trade at $1.3231, slightly above its two-month low of $1.3199.

In agricultural commodities, wheat for March delivery rose 2 cents to $6.8725 a bushel; March corn fell .75 cent to $5.53 a bushel and January soybeans gained 16.5 cents to $12.38 cents a bushel.

Benchmark oil for January delivery fell 10 cents to settle at $83.76 a barrel on the New York Mercantile Exchange.

January heating oil slipped .8 cent to settle at $2.333 a gallon, while December gasoline gave up .33 cent to $2.2103 a gallon and natural gas gained 0.11 cent to $4.399 per 1,000 cubic feet.

Volumes in the U.S. markets were thin on Friday, one day after the markets were closed for the Thanksgiving holiday.