Gold drops, taking big miners with it

The stockmarket closed lower yesterday, after the gold price sagged from 18-year highs and eroded much of the earlier positive momentum built around big resource stocks.
The spot price of gold fell to $US494.50 in Sydney, down $US6.375 on the previous close of $US500.875, which marked the first time since December 1987 that the price had broken through $US500 per ounce.
The ASX 200 lost 4.2 points to close at 4634.8 while the All Ordinaries fell 1.7 to 4583.6.
Bell Potter senior adviser Stuart Smith said the ASX 200 index breached its previous closing high, set on September 29, but was unable to sustain it. "It got past the previous high and didn't like being there," he said.
Market leader BHP Billiton ended 4c higher at $21.87, but off the day's high of $22.17, while Rio Tinto fell back from a high of $62 to close at $61.76, up 41c.
Goldminer Newcrest shed 30c to $21.30 and rival Newmont fell 5c to $6.40.
Lihir Gold shares remained in a trading halt after Rio Tinto announced the sale of a 14.46 per cent stake in the PNG goldminer for about $399 million.
The pharmaceutical sector also grabbed attention because of speculation, later denied, that the Woolworths supermarket chain was in talks with pharmaceutical distributor Australian Pharmaceutical Industries.
AustPharm jumped 19c to $3.23, rival Sigma improved 51c to $13.65 while Mayne spin-off Symbion gained 12c to $3.68.
Woolworths, which declined to comment on the API issue, drifted 9c lower to $17.01 as rival Coles Myer lost 1c to to $9.99.
The big banks were mixed: ANZ climbing 21c to $23.91, Westpac gaining 4c to $22.44, NAB shrinking 24c to $32.46 and the Commonwealth losing 3c to $41.80.
In media, Publishing and Broadcasting Ltd was steady at $16.55 but John Fairfax picked up 2c to $3.92. News Corp was unchanged at $21.33 while its non-voters dipped 12c to $20.29.
Among other blue chips, national carrier Qantas rose 2c to $3.77 and Virgin Blue gained 3c to $1.57.
Telstra dropped 5c to $3.85, its lowest closing price since December 1997, just one month after the telecom's stock was first listed.
Optus owner Singapore Telecommunications rose 4c to $2.02.
The top traded stock was general medical supplies company Pharmanet, with 104.53 million shares valued at $7.40 million changing hands as its shares rose 3.9c to close at 7.1c.
National turnover was 1.48 billion shares worth $5.23 billion - 560 stocks were higher, 468 lower and 342 unchanged.
On the Sydney Futures Exchange the December share price index contract dropped 23 points to 4626 on a volume of 14,791 contracts.