Gold started inching up on Monday on weak US economic data and massive inflows witnessed in the worlds biggest gold-backed exchange traded fund, hitting $1,406.01 an ounce, its highest since June 7. However, the bullion eased from the level as the technical rally lost momentum and spot gold dropped 0.2% to $1,395.85 an ounce by 0941 GMT. US December gold futures rose 10 cents to $1,395.90 an ounce.
The precious metal had gained 1.6% on Friday after the release of weak US house sales data, which could potentially reduce the case for the Federal Reserve to curtail bullion-friendly economic stimulus which was expected to start from September. The SPDR Gold Trust said its holdings rose 6.61 tonnes to 920.13 tonne on Friday, the largest one-day inflow since October 8.
Copper reached its maximum in more than four months in Shanghai on Monday, aided by expectations of a rise in demand from China, the worlds largest refined copper consumer. Last week, data revealed that Chinas manufacturing hit a multi-month high, while better-than-expected growth was seen in the euro zone, raising hopes about a global economic recovery, albeit fragile, which could drive demand for raw materials.
December copper contract on the Shanghai Futures Exchange jumped 1.43% to settle at 53,360 yuan ($8,700) a tonne on Monday. Earlier in the session, it hit 53,620, the highest since April 15. The London Metal Exchange was shut for a holiday on Monday.
Brent crude eased towards $110.50 a barrel on Monday after hitting the highest since April 2 on apprehensions that a suspected chemical weapons attack in Syria may flare up the geo-political tensions and threaten oil supplies from the West Asian region. October brent crude contract gained 50 cents to $110.54 a barrel at 1204 GMT after climbing to $111.68 in early trade. US crude for October dropped 29 cents to $106.13 a barrel.
Large speculators raised their net long positions in Brent futures and options to a new record high in the week to August 20, according to Reuters.
Supply woes due to the disrupted production from the North Sea to Libya has supported brent prices over the past two weeks, while positive economic data from the euro zone and China raised fuel demand outlook.