Gold prices edged higher for a second straight day on Wednesday in U.S. trading. However, prices backed off their highs of the day as a better-than-expected housing report boosted stocks in the U.S.
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.
The U.S. dollar was mixed versus its major counterparts on Wednesday in New York. The buck retreated against pound and gained on the yen, while showing choppy movement against the euro.
Traders also showed lack of confidence that the G20 summit will have a notable positive impact on the struggling global economy. President Obama urged a concerted effort to stimulate the global economy following a meeting with U.K. Prime Minister Gordon Brown. Obama called for world leaders at the G20 to act with a sense of urgency as they look to move forward from the current economic downturn.
On the economic front, the National Association of Realtors said its index of pending home sales rose 2.1 percent to 82.1 in February from a reading of 80.4 in January. The increase by the index came as a surprise to economists, who had expected the reading to come in unchanged compared to the previous month.
Automatic Data Processing's monthly report showed that non-farm private employment fell by 742,000 jobs in March following a revised decrease of 706,000 jobs in February. Economists had expected a decrease of 663,000 jobs compared to the decrease of 697,000 jobs originally reported for the previous month.
Meanwhile, a Institute for Supply Management - Chicago report showed that the index of activity in the sector fell to 31.4 in March from 34.2 in February, with a reading below 50 indicating a contraction in the sector. Economists had been expecting the index to edge up to a reading of 34.3.
Earlier, the Mortgage Bankers Association revealed that its market index of mortgage application volume rose 3 percent on a seasonally adjusted basis for the week of March 27th, following a 32.2 percent jump last week. The Market Composite Index was 1194.4 compared to 1159.4 in the previous week.
April gold finished Tuesday's session at $922.60 per ounce, a gain of $7.10 for the day. The metal tested the $910 mark in the previous session. The metal had lost nearly $25 in the two previous sessions as the dollar gained on other majors.
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