Gold for August delivery was last down 30 cents at $663.80 an ounce on the New York Mercantile Exchange. It climbed $4 on Monday to end a three-session losing streak that subtracted nearly $25 from the contract. Read more.

Most of the trading volume has moved onto the December contract. December gold was last down 60 cents at $676. It’s trading almost $13 above the June 29 close of $663.20.
“Traders remain relatively cautious on this last trading day of a month that saw an encouraging advance in prices become sharply truncated once again by outside factors which impacted investor psychology to a high degree,” said Jon Nadler, analyst at Kitco Bullion Dealers, in an emailed note to clients.

Looking ahead, “dollar weakening and continued high oil prices should provide upside potential for gold, but the market remains nervous, with traders remaining focused on the stock markets,” said analysts at Action Economics.

The dollar traded modestly higher against the yen and euro Tuesday. See Currencies. Crude-oil futures climbed back above $77 a barrel. See Futures Movers. U.S. stocks rallied on Tuesday following above-forecast earnings from Dow component General Motors and benign inflation data. See Market Snapshot.

The stock market had sold off last week, and while the correlation between gold and equities can “sometimes be very strong,” the relationship during the recent market corrections worked in the wrong direction,” said Michael Widmer, a metals analyst at Caylon.

“Gold has, during periods of market volatility, often sold off, as investors needed funds to cover losses or margin calls from other positions,” Widmer explained in a recent research note “This means that safe-haven buying has generally not been a good indicator for gold price movements.”

But the medium and long-term outlook is “less than certain” for the global equity markets, according to Mark O’Byrne, director at Gold & Silver Investments Ltd. “This is likely to provide medium and long-term support to gold prices,” he said in emailed commentary.
In the meantime, traders digested a spate of U.S. economic figures released Tuesday.
U.S. consumers were more positive about the economy and their own finances in July than at any time since 9/11, the Conference Board reported Tuesday. See full story.

Meanwhile, core consumer inflation increased 0.1% for the fourth consecutive month in June, pushing the yearly gain in core inflation down to the lowest level in three years, the Commerce Department said. See full story. In a separate report, it said spending on U.S. construction projects fell 0.3% in June to an annual rate of $1.18 trillion. See full story.
And the Labor Department reported that U.S. compensation costs rose 0.9% in the second quarter, in line with expectations. See full story.

Against this backdrop, other metals prices climbed, with the exception of September palladium, which fell by $1.30 to $366 an ounce to trade below last month’s close of $368.50.
October platinum rose $11.20, or 0.9%, to $1,298 an ounce, up less than 1% from the endo f June. September silver rose 9.7 cents to $13 an ounce. It was trading around 53 cents above the month-ago close. And September copper gained 4.35 cents to stand at $3.632 a pound, up more than 5% from a month ago.

On the stockpiles front, gold warehouse inventories were unchanged at 6.91 million troy ounces as of late Monday, while copper supplies stood at 22,021 short tons, down 267 short tons, according to Nymex data. Silver supplies rose 738,158 troy ounces to 131.6 million troy ounces.
In equities, indexes tracking mining and metals stocks closed higher, reflecting strength in the broader stock market following last week’s sharp sell-off on Wall Street.

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