Sector Snap: Gold mining shares falling

A stronger dollar typically encourages investors to sell hard assets like gold that are known for holding value during inflationary times. A rising greenback also makes dollar-denominated commodities, like gold, more expensive to overseas buyers.

The dollar strengthened for a second day against the 15-nation euro on speculation, fed by the Federal Reserve chairman, that the U.S. central bank is starting to focus on fighting inflation and may raise interest rates.

"Right now the trend is the dollar is rising, and many investors are looking to profit from that (by selling gold)," said Carlos Sanchez, analyst with CPM Group in New York.

Gold for August delivery fell $27.10 to $879 an ounce on the New York Mercantile Exchange, after earlier falling as low as $869 an ounce.

In afternoon trading, shares of Barrick Gold Corp. fell $2.56, or 6.1 percent, to $39.48, Newmont Mining Corp. fell $2.23, or 4.6 percent, to $46.79, Gold Fields Ltd. fell 52 cents, or 4.2 percent, to $12, AngloGold Ashanti Ltd. fell 73 cents, or 2.1 percent, to $34.15, Randgold Resources Ltd. $1.68, or 4.1 percent, to $39.44 and Kinross Gold Corp. fell $1.31, or 6.5 percent, to $18.94.