Chinese gold futures fell on their second day of trading on the Shanghai Futures Exchange (SFE) on Thursday, following a strong debut. The most active June contract closed at 215.12 yuan (about 29.5 U.S. dollars) per gram, down 9.62 yuan or four percent. Its turnover shrank to 19.2 billion yuan from 23.2 billion yuan, according to the SFE website.

The total turnover of the seven contracts, one for each month between June and December, was 20.8 billion yuan, down from more than 27 billion yuan on Wednesday.

Analysts said the futures prices slumped because it swayed too far from the cash commodity price, which closed at just 205.1 yuan on the Shanghai Gold Exchange. The gold futures, as a newly introduced contract, will need some time to settle before the price range is stable.

In the global market, the most active gold contract for February delivery leaped 18.30 U.S. dollars, or 2.1 percent, to 880.30 U.S. dollars per troy ounce, after climbing to a contract high of 884 dollars on the New York Mercantile Exchange (Nymex).

(Xinhua News Agency January 11, 2008)