* Gold climbs as weaker dollar, firmer oil support buying
* Equity markets wilt after disappointing earnings reports
* Platinum moves higher in line with gold
(Recasts, updates throughout, changes dateline, pvs
SINGAPORE)
By Jan Harvey
LONDON, July 22 (Reuters) - Gold rose 1.2 percent as the
dollar held near record lows against the euro, oil firmed, and
the equity markets softened, boosting interest in the precious
metal as an alternative investment to stocks.
Spot gold <XAU=> rose to $972.40/973.40 an ounce at 0921 GMT
from $961.75/963.15 an ounce late in New York on Monday. Earlier
on Tuesday gold futures in Tokyo hit a 25-year high on fund
buying.
"Some of the financial stocks had seemed to be rebounding,
but that is proving to be short-lived," said Standard Bank
analyst Walter de Wet.
"With financial stocks under pressure, it raises credit
market issues once again. That definitely supports gold and
precious metals in general."
Volatility in the equity markets, which spurred buying of
gold as an alternative to stocks and shares, was one of the key
factors that pushed gold to a 4-1/2 month high of $987.75 last
week.
European stocks fell sharply on Tuesday after a sluggish
performance among Asian equities overnight and as Wall Street
posted a drop on Monday. []
The dollar also languished near record lows as investors
worried about the outlook for the U.S. financial sector, further
supporting buying of gold as a currency hedge.
Weakness in the U.S. currency also makes dollar-priced gold
cheaper for holders of other currencies. []
Elsewhere oil firmed, extending gains it posted on Monday
after last week's sharp falls. Crude is supported by a weaker
dollar, and from fears a storm in the Gulf of Mexico could
disrupt production.
Oil's rise is boosting bullion's appeal as an inflation
hedge, as well as bolstering sentiment towards commodities as an
asset class. []
"The $129/130 support level also seems to have held for
crude, which is also supporting gold on the downside," said de
Wet.
ETF DEMAND FIRM
Investment interest in the precious metals is firm, with
holdings of the SPDR Gold Trust in New York -- the largest
gold-backed exchange-traded fund -- rising to 705.59 tonnes on
Monday, close to a record high.
Silver holdings of the United States' largest silver-backed
ETF, iShares Silver Trust, were also at a record 6,092.31 tonnes
on July 16, the last day for which holdings were published.
Among other precious metals, platinum rebounded, climbing
more than 2 percent to a session high of $1,880 an ounce, as
investors feared last week's correction lower may have been
overdone.
Platinum group Johnson Matthey said in its first-half
earnings report that it had seen strong growth in autocatalyst
sales in Asia, though it added sales have dropped in North
America.
Autocatalyst manufacturing is a key use of platinum.
Spot platinum <XPT=> was trading at $1,869.00/1,889.00 an
ounce against $1,837/1,857 in New York, recovering from an
11-week low of $1,825.50 it hit earlier in the session.
"Tight fundamentals will help limit further significant
price weakness in the coming sessions, while chart support is
pegged at $1,828/1,800," said James Moore, an analyst at
TheBullionDesk.com.
Silver <XAG=> rose to $18.57/18.64 an ounce from
$18.35/18.43 late in New York. Spot palladium <XPD=> rose to
$417.50/425.50 an ounce from $410.50/418.50 late in New York.
(Reporting by Jan Harvey; Editing by Peter Blackburn)
