Gold prices slipped on Thursday morning amid hopes the global economy may be on the road to recovery. The drop easily erased gains from yesterday.

June gold closed at $908.90, down $18.80 for the day. Gold for immediate delivery fell to $907.40 an ounce, down $18.70.

Stocks have rallied amid optimism stemming from the G20 Summit in London. Global leaders announced earlier that the meeting is focused on promoting global trade and rejecting protectionism. The high-profile sit-down was convened as world leaders attempt to address the steepest global downturn since the Great Depression, and in the official communiqué G20 members pledged to do whatever necessary to end the economic crisis.

Elsewhere on the economic front, Labor Department report showed that initial jobless claims rose to 669,000 from the previous week's revised figure of 657,000. Economists had expected jobless claims to edge down to 650,000 from the 652,000 originally reported for the previous week.

Meanwhile, factory orders jumped 1.8% in February after six straight months of declines. Economists expected a more modest gain of 1.5%.

On Wednesday, the most-actively traded June gold contract rallied to $927.10, up $2.10 for the session. Prices hit as low as $927.50 in the early going. Gold for immediate delivery closed at $926.10, up $3.50.

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