Gold tumbled to the lowest price since July 2011, slumping into a bear market, on signs that investors are favoring the dollar and equities as the global economy recovers. Silver dropped the most since June.
Stocks rose, sending the Standard & Poor’s 500 Index to a record close, as concern over Europe’s debt crisis eased and U.S. factory orders topped forecasts. Gold fell and Italian and Spanish bond yields slid.
Gold is in a “bubble” after the best annual run in at least nine decades and will head into a so-called bear market as a stronger U.S. economy helps increase interest rates and cut bullion demand, Societe Generale SA said.
Blythe Masters , JPMorgan Chase & Co. ’s head of commodities, sought to reassure her team on an internal conference call after “extremely difficult” dismissals, defections and a first half in which some results were as much as 20 percent below expectations.