Gold ends lower as oil losses weigh

By Frank Tang and Lewa Pardomuan

NEW YORK/LONDON (Reuters) - Gold ended lower on Monday, giving up overnight gains due to retreating crude prices, but a further oil rally may help bullion defy declines in demand from jewelers and other physical buyers.

Meanwhile, silver finished nearly 2 percent higher in spite of gold's decline, as buy-stops accelerated gains after prices breached above resistance level, floor traders said.

Gold hit a high of $889.10 an ounce before slipping to $884.60/886.00 an ounce by New York's last quote at 2:15 p.m. EDT, down from $886.30/888.30 in New York late on Friday, when it jumped to a 10-day high of $889.80.

Gold has lost more than 14 percent in value since spiking to a record high at $1,030.80 an ounce on March 17. It tumbled to a four-month low at $845 in early May.

U.S. crude futures ended down nearly $2 at just above $124 a barrel after initially setting a record high of $126.40 a barrel.

James Steel, metals analyst at HSBC in New York, said that oil's weakness was a dominating factor for gold's decline amid quiet trade.

Steel said the future direction of crude oil could still definitely influence the price outlook of gold.

In the past two months, gold prices have failed to move higher in spite of a sharp rally of crude oil to record peaks.