Gold prices down further on dollar gains

Gold prices eased Friday as some disappointment over U.S. economic data reverberated, driving gains for the U.S. dollar.

Gold futures for December delivery GCZ2 -0.56%  fell $7.80 to $1,737 an ounce on the Comex division of the New York Mercantile Exchange. On Thursday, gold fell $8.30, or 0.5%, to $1,744.70 an ounce.

A report released in the U.S. on Thursday showed that first-time jobless claims rose by a sharper-than-expected amount. Initial claims rose 46,000 to 388,000, erasing a sharp drop seen the prior week. Read: Ignore volatile jobless data: Hiring still slow

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The dollar was boosted by the data. Strength in the greenback in turn tends to hurt dollar-denominated commodities such as gold.

The dollar index DXY +0.11%  , which measures the greenback against a basket of six currencies, rose to 79.371 from 79.207 in late North American trading on Thursday.

The dollar was also gaining as investors eyeballed the European Union summit for news and braced for some disappointment on banking supervision. The European Council said early Friday that it has set a deadline of Jan. 1 for agreeing a legislative framework for a single banking supervisor.

“Europe’s politicians seem to have kicked things into the long grass for a few more months as they fail to agree on steps towards banking supervision or closer political (i.e. fiscal) integration,” said Rebecca O’Keeffe, head of investment at Interactive Investor, in a note Friday. “As interest rates continue to fall, so the need to act decisively diminishes.”

U.S. stock-market futures were pointing to losses for Wall Street after some disappointing earnings from Microsoft Corp. MSFT -0.32%   released after the close of trading Thursday.

Europe stocks traded weaker across the board.

Among other metals on Friday, platinum for January delivery PLF3 -0.35%  fell $2.60 to $1,641.10 an ounce, while December palladium PAZ2 -1.41%  fell $8.20, or 1.3%, to $638.80 an ounce.

Copper for December delivery HGZ2 -1.06%  lost 3 cents to settle at $3.71 a pound.

December silver SIZ2 -1.39%  shed 23 cents, or 0.7%, to $32.64 an ounce.