Gold steadies just below $1,100

The precious metal continues to trend higher, settling at $1,089 as stocks rally.

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By Ben Rooney, CNNMoney.com staff reporter

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NEW YORK (CNNMoney.com) -- Gold was modestly higher Thursday, as stocks rallied and investors took a step back following the precious metal's recent push near $1,100 an ounce.

December gold rose $2 to $1,089.30 an ounce after jumping as high as $1,093 an ounce earlier in the session.

The advance came as stocks rallied, with the Dow industrials topping 10,000, after a bigger-than-expected drop in jobless claims and improved October retail sales. The Dow Jones industrial average (INDU) gained 200 points, or 2%, with 40 minutes left in the session.

Gold had surged to an all-time trading high of $1,096.20 an ounce early Wednesday as investors focused on the International Monetary Fund's sale of 200 metric tons of the metal to India's central bank.

The move raised bets that more overseas central banks will increase their gold reserves, and eased some concerns that such a large dose of supply would weigh on prices in the open market.

But the gold rally lost momentum after the Federal Reserve announced plans to hold interest rates near historic lows for an "extended period" despite signs of economic improvement.

Gold ended the previous session up $2.40 at $1,087.30 an ounce.  To top of page

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