PRECIOUS-Gold slides more than 2% as Pfizer vaccine news boosts risk appetite

  • Reuters
  • Commodities News
PRECIOUS-Gold slides more than 2% as Pfizer vaccine news boosts risk appetite
Credit: © Reuters.

* COVID-19 vaccine report sets up U.S. stocks for record

* Dollar hovers near a more than two-month low

* Interactive graphic tracking global spread of coronavirus: (Adds comments and updates prices)

By Asha Sistla

Nov 9 (Reuters) - Gold beat a sharp retreat on Monday, sliding over 2% after Pfizer (NYSE: PFE ) said initial data from a large study showed its COVID-19 vaccine was more than 90% effective, sending stock markets soaring and denting bullion's safe-haven appeal.

Spot gold XAU= slipped 2.2% to $1,908.55 per ounce by 1302 GMT, while U.S. gold futures GCv1 fell 2.2% to $1,908.90.

Earlier spot prices climbed to their highest since Sept. 16 at $1,965.33, driven by a weak dollar amid hopes for more stimulus following Joe Biden's victory in the U.S. elections.

Pfizer and German partner BioNTech SE BNTX.O , the first drugmakers to show successful data from a large-scale clinical trial of a vaccine, said they expect to seek U.S. emergency use authorization for the drug later this month. some belief that this is going to be a driver for economic growth as we come out of the pandemic situation, so it's positive news for the world, but negative news for gold," said independent analyst Ross Norman.

The news prompted sharp gains in stock markets, and set Wall Street up for a record. However weakness in the dollar index .DXY , which held close to an over 10-week low, kept gold above the key $1,900 level. USD/ MKTS/GLOB .N

Alexander Zumpfe, a precious metals trader at Heraeus, said in a note that while the reaction to the vaccine report had come as no surprise, nothing had changed in the medium-term positive outlook for the metal.

"Interest rates will remain low to negative for the foreseeable future - this makes gold still attractive for investors," he said.

Unprecedented stimulus and near-zero interest rates globally, which cut the opportunity cost of holding non-yielding assets, have driven gold about 25% higher this year, given its status as a hedge against currency debasement and inflation.

Elsewhere, silver XAG= slid 3.3% to $24.74 per ounce.

Platinum XPT= fell 1.4% to $876.20, while palladium XPD= dipped 1.5% to $2,452.71.

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