Precious metals miners Fresnillo PLC (LSE:FRES) and Hochschild Mining PLC (LSE:HOC, OTCQX:HCHDF) were leading the FTSE 350 fallers on Tuesday as gold and silver market prices continued to decline.
The sell-off of gold saw its spot price decrease 2.2% to $3,892 per troy ounce, while silver eased another 2.5% to $45.66 per oz.
Since reaching highs above $4,380 last Monday, spot gold has dropped 11%, wiping out all the gains made earlier in the month.
Analysts at Deutsche Bank said the fall in gold was the second steepest daily decline since November last year, with last Tuesday’s 5.2% drop the largest in five years.
Fresnillo shares dropped 4.1%, while fellow blue-chip Endeavour Mining PLC (LSE:EDV, TSX:EDV, OTCQX:EDVMF) fell 3% and Hochschild fell 3.1%.
The retreat is in counterpoint to the rally in US tech giants.
Better-than-expected inflation data on both sides of the Atlantic has "taken the shine off the yellow metal," said analyst Derren Nathan at Hargreaves Lansdown, "but the prospect of falling treasury yields, continuing dollar weakness and strong demand from central banks could tempt some to buy the dip".
Market analyst Kyle Rodda at Capital.com said: "sentiment towards gold soured as two tailwinds to its uptrend, geopolitical risks and US trade policy, diminished".
He added: "The move is the inevitable result of an asset that was completely gripped by mania and speculation for the better part of a month.
"Despite the sell-off, gold's uptrend remains structurally in place but with slightly weaker fundamentals because of the shift in geopolitical and trade policy risk.
"Nevertheless, things like central bank buying and the prospect of loose monetary and fiscal policy next year ought to keep gold prices supported in the longer run."