* Weak dollar against euro spurs gold buying
* Trading thin due to holiday in Japan, U.K.
* Platinum falls further on demand worries
By Lewa Pardomuan
SINGAPORE, May 4 (Reuters) - Gold rose more than $5 on
Monday on a weaker U.S. dollar and light Chinese buying, but
rising stock markets could curb gains, while platinum dropped
on worries about slumping demand for autocatalysts.
The yellow metal fell 3.5 percent in April as signs of
economic recovery boosted risk appetite and dented safe-haven
demand. It hit a near four-week high of $918.25 last Monday but
failed to sustain the gains as investors shifted some of their
money to shares.
Spot gold <XAU=> was quoted at $891.60 an ounce, up $5.80
from New York's notional close. Gold has fallen 11 percent
since spiking to an 11-month high above $1,000 in February on
profit taking, lower oil prices and gains in stocks markets.
"I think it's certainly consolidating. I am not convinced
we won't see those highs again yet and possibly go higher,"
said Darren Heathcote of Investec Australia in Sydney.
"We are heading towards the wedding season, so we are
getting a bit of support coming in on the downside as we dip. I
think the dollar's probably the major driver at the moment," he
said.
Gold buying has picked up in India during the wedding
season, when jewellery is the most common gift during religious
events and forms an essential part of the dowry basket.
Trading was thin, with Japanese markets closed for Golden
Week holidays until Wednesday. Britain's markets are also
closed on Monday for May Bank Day holiday.
The euro <EUR=> inched up to $1.3335 <EUR=> from $1.3264 on
Friday after better economic data worldwide spurred hopes the
worst in the global economy may be past. []
Gold typically moves in an opposite direction to the
dollar, which is often bought as an alternative to the U.S.
currency. But the dollar and gold have recently tracked each
other, reacting to risk aversion.
Hong Kong shares extended gains to rise more than 4 percent
on Monday, sending the main index to its highest level since
mid-October 2008, with investors cheered by signs of recovery
in China and stabilisation in the U.S. economy. []
"Stocks are pretty good, so I don't think gold can move up
much higher. There may be some resistance at $894," said a
dealer in Hong Kong, a referring to a high seen in late April.
"We've seen light demand from physical buyers in mainland
China, but it's such a thin market because of the absence of
the Japanese," he said.
Platinum <XPT=> was at $1,087.50 an ounce, down $0.50 from
New York's notional close, having fallen 2.27 percent in April.
The metal fell to an intraday low of $1,081 on Monday.
Platinum is used to clean exhaust fumes from vehicles and
slumping car sales during the global economic downturn weighed
on sentiment.
U.S. auto sales fell 34.4 percent in April as the industry
held near the lowest levels in nearly 30 years and closed out
the month with Chrysler LLC filing for bankruptcy protection.
[]
The world's largest gold-backed exchange-traded fund, the
SPDR Gold Trust <GLD>, said holdings stayed at 1,104.45 tonnes
as of May 3, unchanged since April 23. []
ETF Securities, operator of Europe's largest
platinum-backed exchange-traded fund, said its Physical
Platinum fund <PHPT.L> saw an outflow of 16,600 ounces on
Thursday, equivalent to 5 percent of its total holdings.
[]
PRICES
Precious metals prices at 0533 GMT
Metal Last Change Pct chg Day ago pct MA 30
RSI Spot gold $891.60 $5.80 +0.65% -0.60% $860.10
43
Spot silver $12.59 $0.13 +1.04% +5.09% $11.29
48
Spot plat $1087.50 -$0.50 -0.05% -0.05% $1151.87
28
COMEX gold $892.70 $4.50 +0.51% +0.17% $901.49
43
Currencies
Euro/dlr $1.331 $0.008 +0.60% +0.47%
Dlr/yen 99.44 2.67 +2.76% +2.36%
(Editing by Clarence Fernandez)
