(Updates prices)
By Lewa Pardomuan
SINGAPORE, March 12 (Reuters) - Bargain hunters lifted gold
on Wednesday and helped it defy pressure from a steadier U.S.
dollar as well as rising stocks, but the metal was struggling
to break the $1,000 an ounce barrier.
Gold <XAU=> firmed to $974.20/975.00 an ounce from
$971.00/971.80 late in New York on Tuesday, after it earlier
hit a low around $964 when the dollar rose after global central
banks announced plans to boost liquidity to financial markets.
Gold has dropped nearly 2 percent since a spike to a
lifetime high of $991.90 on March 6, but dealers said record
high oil and expectations of further interest rate cuts in the
United States would still attract interest from investors.
"I think we are still talking about $1,000 sometime this
year. There are so many bulls in the market," said Ronald
Leung, director of Lee Cheong Gold Dealers in Hong Kong.
"We can say the market is consolidating. If it goes above
$995, the market will shoot up to $1,000. If it goes below
$955, then it may test $950. There's a bit of bargain hunting
but I think investors really don't know what to do,"said Leung,
referring price volatility.
Gold has gained as much as 19 percent this year.
The dollar steadied on Wednesday after rebounding from
record lows against the euro the previous day on the Federal
Reserve's steps to boost liquidity in the banking system which
raised hopes that credit conditions might improve.[]
The Fed's move sparked a rally in stock markets, with
Japanese stocks <> jumping more than 3 percent.
[]
In theory, rising stock markets and a firmer dollar will
diminish gold's appeal as an alternative investment.
Other precious metals were below their recent highs.
Spot platinum <XPT=> fell to $2,040/2,050 an ounce from
$2,050/2,060 late in New York -- off a record high of $2,290
hit on March 4 as speculators booked profits on news that
miners in main producer South Africa would get more supply.
But Tokyo platinum futures shrugged off a weak cash market
and jumped more 3 percent as the dollar bounced against the
yen.
The benchmark platinum futures contract for February
delivery <0#JPL:> on the Tokyo Commodity Exchange ended the
morning session 210 yen per gram higher at 6,619 yen.
"Although concerns about power problem in South Africa have
been eased, we are not completely sure about supplies from the
country, so we are still worried," said Hiroyuki Kikukawa, an
analyst at IDO Securities in Tokyo.
"Platinum is now in a correction phase after seeing massive
fund inflows, but long-term trend for the market is still
bullish as concerns over supplies stay."
Both cash and Tokyo platinum futures have rallied to record
high on supply fears after an electricity shortage disrupted
mining in South Africa. Spot platinum has risen as much as 50
percent in 2008.
Gold futures for April delivery <GCJ8> on the COMEX
division of the New York Mercantile Exchange lost $2.1 an ounce
to $973.9 an ounce.
Silver <XAG=> edged up to $19.71/19.76 an ounce from
$19.61/19.66 an ounce. Spot palladium <XPD=> rose to $488/493
an ounce from $486/491 an ounce.
Precious metals prices at 0212 GMT
Metal Last Change Pct chg YTD pct chg
Turnover
Spot Gold 974.20 1.20 +0.12 16.99
Spot Silver 19.71 0.06 +0.31 33.45
Spot Platinum 2040.00 -10.00 -0.49 34.21
Spot Palladium 488.00 2.00 +0.41 32.61
TOCOM Gold 3258.00 40.00 +1.24 6.47
23544
TOCOM Platinum 6619.00 210.00 +3.28 23.97
9376
TOCOM Silver 660.20 8.20 +1.26 22.03
688
TOCOM Palladium 1680.00 68.00 +4.22 24.35
6633
Euro/Dollar 1.5357
Dollar/Yen 103.03
TOCOM prices in yen per gram, except TOCOM silver which is
priced in yen per 10 grams. Spot prices in $ per ounce.
(Additional reporting by Chikafumi Hodo in Tokyo; Editing by
Tomasz Janowski)
