* Gold supported by haven demand, capped by dollar gains
* SPDR gold ETF holdings rise more than 16 T to record
(Recasts to add update prices, comment)
By Carole Vaporean and Jan Harvey
NEW YORK/LONDON, May 25 (Reuters) - Gold prices pushed
higher on Tuesday in a safe-haven play, while platinum group
metals took a heavy hit with other industrial metals, as
investors feared a second economic slowdown could be triggered
by European credit woes.
Gains in gold were stunted by the euro's losses to near
four-year lows against the dollar. Concerns were growing for
global growth prospects after Spain took over a small bank over
the weekend, fanning fears the euro zone's sovereign debt
crisis was spreading. []
Meanwhile, platinum and palladium fell sharply, resuming
the slide seen last week, as investors took fright at a further
drop in the euro and equity markets, and industrial end-users
held out for lower prices.
U.S. gold futures for June delivery <GCM0> on the COMEX
division of the New York Mercantile Exchange rose $4 to settle
at $1,198.00 an ounce.
Spot gold <XAU=> was bid at $1,199.95 an ounce by 4:20 p.m.
EDT (2020 GMT), against $1,190.05 late in New York on Monday.
It hit a session high over $1,200 in early trade.
Platinum <XPT=> fell around 3 percent to a low of
$1,478.25, but was later bid up to $1,510.00 an ounce against
$1,526.50 on Monday.
Palladium <XPD=> was at $436.00 against $444.50 the
previous session. It hit a session low of $420.88, down 5.3
percent.
Platinum slid 12.3 percent last week and palladium 17.2
percent, its worst weekly loss since 2003, as fund selling
sparked losses in both metals that led to lowest levels seen
since February.
While industrial users found value at last week's lows and
lifted prices later in the week, caution toward the metals has
reemerged as a 1 percent drop in the euro and weak stock
markets undermined most commodity metals.
"It looks like people are still unsure about what the
investors are doing," said Wolfgang Wrzesniok-Rossbach, head of
sales at Heraeus. "If ETF holders should start to liquidate
some of their positions because they need cash, (the
correction) might not be over yet."
U.S. stock prices fell after European shares extended
losses to lows unseen in nine months on worries over Europe's
banking sector and tensions on the Korean peninsula. []
[]
"People are going long (on gold) again with equities that
continue to slide. All equities are bearish at the moment ...
it's probably going to get worse before it gets better," said
Standard Bank analyst Walter de Wet.
"If gold goes below $1,180 it's definitely a good buy. We
think it's going to head higher and end the year above
$1,300."
Among other commodities, NYMEX oil fell below $68 a barrel
on fears Europe's debt crisis could derail the global economic
recovery. Industrial metals like copper and aluminium also
fell. [] []
HAVEN FROM RISK
While other assets are suffering from credit concerns, gold
was finding support from safe-haven demand. Though gold's gains
were modest, some analysts said its value relative to the sharp
declines in other metals added to its appeal.
Also, as some players sought to augment their cash
positions, gold received a lighter boost than in other recent
buying sprees amid credit-risk concerns.
The world's largest gold-backed exchange-traded fund, New
York's SPDR Gold Trust <GLD>, said its holdings rose more than
16 tonnes to a record 1,236.889 tonnes as of May 24.
[]
"Global (ETF) holdings have grown by 3.63 million ounces so
far this month, by far the largest monthly increase this year,"
said UBS analyst Edel Tully in a note.
A Reuters poll of analysts, traders and fund managers found
on Tuesday the majority expect gold to resume its uptrend, with
21 out of 26 respondents predicting the metal will end the year
at record levels. []
Silver <XAG=> was bid at $17.86 an ounce versus Monday's
close of $17.82.
(Additional reporting by Maytaal Angel; Edited by Sofina
Mirza-Reid)
