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Gold shows weaker

NEW YORK: COMEX gold was slightly weaker at midday in thin trade, as this morning's over-the-counter options expiry passed largely without incident.

Traders said the spot price was not close enough to any of the key strikes for the expiry to have a substantial impact on prices.

At 1212 EDT, December gold was off $0.10 at $387.70 an ounce, traded narrowly between $388.10 and $387.30.

Dealers quoted bullion at $382.90/$383.40.

The market also showed little interest in stronger than expected U.S. economic data released at mid-morning.

July new home sales rose slightly to a seasonally adjusted 715,000 units from June's downwardly revised 712,000. Analysts' average forecast had called for a July reading of 712,000.

August consumer confidence came in at 101.0 versus an average forecast of 100.5 and July's upwardly revised 101.4.

Silver

NEW YORK: COMEX silver remained weaker at midday, after trade and light fund selling pressured the market early, traders said.

Some traders said the early slump may have reflected an attempt to reach the $5.50 an ounce strike price ahead of this morning's over-the-counter options expiry, although prices managed to find support and bounce before reaching that level.

The options expiry passed largely without incident.

At 1230 EDT, December silver was off 4.8 cents at $5.64 an ounce, traded between $5.66 and $5.58, its lowest level since August 17. A peak of $5.685 was seen on ACCESS trade overnight. September was off 5.7 at $5.555, traded from $5.585 to $5.53.

Open interest data for Monday showed a sharp drop of 5,944 lots to 110,679, suggesting that many players covered positions in the September contract rather than rolling them forward into December. September open interest dropped 7,782 lots while December rose 1,777.-Reuter