GOLD HOLDS MONDAY'S GAINS

Gold is trading flat on the New York Spot Market as of 10:38 a.m. EST as investors debate the security of gold against riskier stocks. Investors were buying stocks but keeping gold as a hedge against risk. The Fed will begin buying U.S. Treasuries today, which is part of a plan announced last week to help pump money into the economy. (The Street, 8/17/10)

Stocks are treading water on the New York Stock Exchange as investors remain cautious about the economic recovery amid mixed economic reports. The Fed's outlook about a slowing economic recovery is still weighing on investor’s minds, said Dan Cook, senior market strategist with Chicago-based brokerage firm IG Markets. Strong earnings reports from retail giants Wal-Mart and Home Depot helped to drive stocks higher, he said, but since both companies' profits seemed to be tied to cost-cutting measures rather an uptick in consumer spending, "it doesn't look like there's much to support taking us too much higher today," Cook said. (CNN Money, 8/17/10)

Daniel Smith, an analyst at Standard Chartered Bank, expects gold prices to push higher as investors buy the metal on concerns about economic stability and a weakening dollar. Smith tells Reuters, "People are worried about the pace of recovery, particularly after some quite weak data out of the United States and Japan recently. At the moment it looks like the market is breaking down that overhead resistance and we're likely to move up to $1,250 as the next target.” (Reuters, 8/17/10)