By Laura Mandaro & Nick Godt, MarketWatch SAN FRANCISCO (MarketWatch) -- Gold futures resumed losses in volatile trade on Wednesday after two economic reports contained seeds of disappointment, sinking stocks and lifting the dollar. Gold for December delivery was recently down $1.20 an ounce, or 0.1%, to $1,034.20 an ounce. It had briefly bounced higher after a report showed U.S. new home sales unexpectedly fell 3.6%, but resumed its slide as the U.S. dollar advanced. The U.S. dollar index (DXY 76.22, +0.08, +0.11%) rose to 76.207 from 76.149 late Tuesday. Equity markets fell. The S&P 500 (SPX 1,052, -10.92, -1.03%) lost 8 points to 1,056, while the Dow Jones Industrial Average (INDU 9,849, -33.40, -0.34%) fell 17 points to 9,865. See Currencies. A stronger dollar tends to diminish the value of dollar-denominated hard assets, such as gold. But gold has been rising along with stocks and other commodities recently. The Commerce Department said new-home sales fell to a seasonally adjusted annual rate of 402,000 in September, well below the 438,000 pace expected by economists surveyed by MarketWatch. Earlier, the government said U.S.-made durable goods rose 1% in September on stronger demand for machinery, defense and capital goods. Shipments rose 0.8% in September, but were down 0.8% excluding transportation goods. See Economic Report. Adding pressure on markets, Goldman Sachs cut its forecast for Thursday's report on third-quarter gross domestic product to a 2.7% growth rate from an earlier forecast of 3% after the durables report, citing weaker shipments. December silver also fell, off 18 cents, or 1.2%, to $16.355 an ounce. December copper lost 3 cents, or 1.1%, to $2.964 a pound. In energy trading, crude-oil futures fell 1.7%, also diminishing the value of gold as a hedge against potential inflation. See Futures Movers.

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