* Gold breaks through $955/oz, hits highest since June 12
* SPDR, ETF Securities gold ETFs see outflow on Wednesday
(Updates throughout, changes dateline-pvs TOKYO)
By Jan Harvey
LONDON, July 23 (Reuters) - Gold rose above $955 an ounce to
a six-week high in Europe on Thursday as the dollar weakened in
response to an uptick in risk appetite.
The market shrugged off a second daily outflow from the
world's largest gold ETF, New York's SPDR Gold Trust <GLD>, and
ETF Securities' smaller London-based gold fund, as interest
shifted to other products, analysts said. []
Spot gold <XAU=> was bid at $954.60 an ounce at 0937 GMT,
against $950.40 an ounce late in New York on Wednesday. Earlier
it hit a peak of $956.50 an ounce, its highest since June 12.
"Prices remain well supported above the $950 an ounce mark,
largely on the back of the weaker dollar," said Calyon metals
analyst Robin Bhar.
"It may be that outflows from things like the ETFs or the
retail base are being offset by more buying of OTC- or
futures-based (products)," he added.
The dollar edged close to a seven-week low against the euro
and a basket of currencies as early gains on the European stock
markets after a strong session in Asia suggested risk appetite
was strong. []
Oil held above $65 a barrel after a drop in U.S. crude
stocks and a rise in equities. Stock market gains are also
underpinning gold, analysts said. []
"Amid the current environment of weak physical and
investment demand, gold has created a nice $50/oz rally off the
lows made two weeks ago, due to gains in the stock market," said
MF Global in a note.
World stocks climbed close to a nine-month high as
forecast-beating earnings reports from the likes of Credit
Suisse <CSGN.VX> fuelled interest in assets seen as higher risk,
such as equities, commodities and certain higher-yielding
currencies. []
JEWELLERY LANGUISHES
In addition to ETF outflows, jewellery demand stayed weak.
Indian buyers stayed away from the market as the weak dollar
pushed local prices towards 15,000 rupees per ten grams.
[]
Buying in the world's biggest bullion market is unlikely to
pick up until the end of August, traders said, when dealers will
replenish stock for the festival season.
Among other precious metals, silver <XAG=> was at $13.81 an
ounce against $13.68, platinum <XPT=> was at $1,174.50 an ounce
against $1,172, and palladium <XPD=> was at $255.50 against
$252.50.
Lonmin <LMI.L>, the world's number three platinum producer,
said its full-year sales will miss its target, but said it was
on track to deliver lower costs. Third quarter production eased
1 percent to 178,494 ounces. []
In South Africa, source of four out of five ounces of the
world's platinum and the third largest gold producer, protests
over jobs and services spread on Wednesday, with police firing
tear gas and rubber bullets at protestors. []
Trade unions have been threatening industrial action at
platinum and gold producers in a bid to improve working
conditions.
(Reporting by Jan Harvey; Editing by Michael Kahn)
