DJ PRECIOUS METALS: NY Gold Cuts Loss As Oil Bounces, Yields Dip

Gold futures initially fell on long liquidation as crude oil tumbled Monday,then pared their loss as crude recovered and Treasury yields eased slightly. Signs that South African labor negotiations will continue for at least awhile yet also deflated the metal some, since this delays potential for asupply disruption, analysts said. August gold fell $2.30 to $654.70 an ounce on the Comex division of the NewYork Mercantile Exchange. As pit trade was closing, the August contract at theChicago Board of Trade was down $2.50 to $654.60. Comex July silver fell 14.3 cents to $12.877. As it was closing, CBOT Julysilver was down 16 cents to $12.869. The metals were initially drug down by the weaker crude-oil prices thatoccurred for much of the session, said Jim Steel, analyst with HSBC. At onepoint, August crude oil was as low as $67.55, down $1.59 from Friday's close. Atrader reported light long liquidation in the metals. However, August crude oil recouped its losses by the time gold closed,enabling the metal to pare its loss, Steel said. Gold also was able to stem itsdecline due to a slight downtick in Treasury yields, he added.