NEW YORK, Nov 16: COMEX gold fell to a nine-week low on Thursday as its war premium receded and dealers shrugged off the potential for buy backs by Newmont Mining related to its bid for Normandy Mining, dealers said.

The liquidation of long positions combined with fresh selling by commodity funds to tip the December gold contract below the psychological $275 an ounce level to $274.70, the lowest since Sept 11, when trading was abruptly stopped by the attacks on lower Manhattan.

The benchmark contract settled at $275.30, down $2.70. Business was brisk with an estimated 35,000 contracts traded and 3,304 switches.

Spot gold held its ground at $275, ending at $275.00/50, down from $277.40/90 at Wednesday’s close and Thursday’s afternoon fix in London at $275.45.

Everything seems to be going back to where it was, so possibly we’re going to test the gap to the downside at $271.20-72.

The gold market grew overbought in the wake of Sept 11, with futures rallying to $300 an ounce shortly after. But prices stalled and the market remains frustrated because producer and central bank selling has derailed almost every gold rally in recent years.

December silver tracked gold, falling 3.5 cents to $4.108 an ounce, in a $4.15 to $4.08 range.

Turnover was a dull 8,000 lots with 744 switches. Spot bullion was at $4.13/15, down from $4.15/17 at the close. Thursday’s fix was $4.11 an ounce.

NYMEX January platinum eased $2.40 to $423 an ounce. Spot platinum last stood at $424/429. December palladium rose $6.95 to $325.95 an ounce. Spot was at $316/326.—Reuters