Gold prices fell over 1% on Tuesday, retreating from a near one-month high hit earlier in the session, as signs of slowdown in coronavirus cases in major epicenters boosted equity markets, drawing away some of the bullion’s safe-haven appeal.

Spot gold fell 1% to $1,644.51 an ounce by 1:36 p.m. EDT, after touching $1,671.40.

“What we’re seeing in equity markets is more of a stabilization with the peaking (coronavirus) numbers in some U.S. jurisdictions,” said Bart Melek, head of commodity strategies at TD Securities.

“All that really tells us is that there might be an end game to this, but by no means is the world benign and risk friendly,” he said, adding that expectations of more stimulus with lower interest rates for the long term will continue to support gold prices.

World stock markets registered a second day of sharp gains on signs of progress against the coronavirus in both Europe and the United States.

Eurozone finance ministers are likely to agree on measures worth half a trillion euros for finance recovery, while Japanese Prime Minister Shinzo Abe declared a state of emergency and rolled out a nearly $1 trillion stimulus package to soften the economic blow.

Gold prices had risen as much as 3.2% in the previous session.

“The underlying reason why we have rallied these past couple days was not only due to the spread widening (between spot and COMEX gold), but also the fact that we are seeing additional measures being touted by central banks,” said Saxo Bank analyst Ole Hansen.

“They’re already talking about the next package in the U.S. to be released after Easter. As long as we see these initiatives combined with the potential for a softer dollar, the upside potential for gold is still there.”

U.S. gold futures settled 0.6% lower at $1,683.70, but held a lead over London spot prices, signaling market concern that refinery closures and logistics constraints could hamper bullion shipments to the United States to meet contract requirements.

Gold stocks held in New York vaults registered with CME Group have jumped almost 50% since the end of last week as the exchange launched a new contract and a price premium since the outbreak encouraged traders to stockpile.

Palladium gained 1.9% at $2,195.30 an ounce, platinum rose 0.5% to $738.66 and silver inched up 0.2% to $15.

© Copyright Thomson Reuters 2020.