CHICAGO, Sept. 26 (Xinhua) -- Gold futures on the COMEX Division of the New York Mercantile extended loss on Monday, the fourth straight drop in a row, as investors rushed for cash amid liquidity crunch due to massive losses on other assets.
The most active gold contract for December delivery lost 45 U.S. dollars, or 2.7 percent, to 1,594.8 dollars per ounce, the lowest settlement since July 8.
Market analysts said that the gold market is suffering drastic correction as investors are cashing in their profits to cover loss in other investments. Besides, the increase in margin requirement also added to the negative tone.
A trader noted that gold is one of the few assets that remain in positive territory this year, so investors head for cash from this market.
CME Group on Friday raised the margin requirements for some futures contracts of gold, silver and copper. As a result, gold price plunged by more than one hundred dollars in the day, or 5.9 percent, the biggest drop in five years.
However, HSBC`s analyst said that the decline in speculative positions meant that the short-term longs are being cleaned out of the market, which could leave gold well-placed to trade higher when the current selling cycle ends.
Silver for December delivery declined 12.5 U.S. cents, or 0.4 percent, to 29.976 dollars per ounce. Platinum for October delivery also shed 66.3 dollars, or 4.1 percent, to 1,546.9 dollars per ounce.