* SPDR Gold holdings fall 0.3 pct to 1,115.884 tonnes
* U.S. platinum, palladium ETFs so far buy total 170,000 oz
By Risa Maeda
TOKYO, Jan 13 (Reuters) - Gold was little changed on
Wednesday with investors seeking new trading factors after a
broad sell-off in commodities the previous day when China's
surprise monetary tightening sapped investor appetite for riskier
assets.
China started tightening monetary conditions on Tuesday as
the world's third-largest economy roars ahead, surprising
investors with an increase in banks' required reserves and
rattling global financial markets. []
Spot gold <XAU=> steadied after falling more than 2 percent
on Tuesday after the news, marking the biggest one-day percentage
loss since Dec. 17. It has slid 2.8 percent from a five-week high
of $1,161.50 marked on Monday.
Technical selling had dragged prices lower after spot bullion
fell below its 50-day moving average at $1,130, analysts said.
While analysts said further aggressive selling was unlikely,
gold was still vulnerable to a technical correction as new money
inflows from fund managers in the past weeks had helped prop up
gold prices.
"The news on China's central bank triggered a wave of
selling. But the market still looks a bit overbought after active
buying by index funds especially at the start of the year," said
Tetsu Emori, a fund manager at Tokyo-based asset manager Astmax
Co.
Gold was trading at $1,128.70 an ounce as of 0615 GMT on
Wednesday, little changed from New York's notional close of
$1,127.95.
U.S. gold futures for February delivery <GCG0> were at
$1,129.20 an ounce, also little changed from $1,129.40 on the
COMEX division of the New York Mercantile Exchange. Futures
settled Tuesday down $22 or 1.9 percent.
Astmax's Emori said historical data shows that reversals of
rallies between late December to early January often result in a
6-10 percent correction before bottoming out.
Volatility in commodity prices could stay high in the coming
days as passively managed index funds are set to rebalance their
holdings in line with the new weighting portfolio for 2010 by
such commodity indexes like S&P GSCI <.SPGSCI> and Dow Jones UBS
<.DJUBS>. []
Hiroyuki Kikukawa, general manager of market research at
Nihon Unicom, also said volatility will remain high for
commodities, including gold, for the next week or so, as players
keep a close eye on news out of China.
"Commodities have been rising since the start of the year, so
it's time for some correction," he said. He added gold was likely
to test the downside near $1,110 on China-related news.
In the currency market, the euro stayed on the defensive
against the dollar <EUR=>, retreating from a four-week high above
$1.45 on Monday. []
The holdings of the world's largest gold-backed
exchange-traded fund, SPDR Gold Trust <GLD>, extended recent
declines. But physical buying by newly listed U.S. platinum and
palladium ETFs rose in the first two trading sessions.
SPDR Gold Trust said its holdings fell 3.657 tonnes or 0.3
percent to 1,115.884 tonnes on Tuesday, the lowest level since
mid-November. []
As of Monday, ETFS Physical Platinum Shares <PPLT> had bought
80,000 ounces of platinum, while the ETFS Physical Palladium
Shares <PALL> held 90,000 ounces of palladium, a ETF Securities
spokeswoman said. []
Spot platinum <XPT=> was at $1,572 an ounce against its
notional New York close of $1,568.50. Spot palladium <XPD=> was
at $423 against $421.50.
On Tuesday, platinum reached $1,624, its highest since August
2008, while palladium hit an 18-month high of $439.
Precious metals prices at 0613 GMT
Metal Last Change Pct chg YTD pct chg Turnover
Spot Gold 1128.95 1.00 +0.09 3.03
Spot Silver 18.25 0.01 +0.05 8.44
Spot Platinum 1574.50 6.00 +0.38 7.33
Spot Palladium 423.00 1.50 +0.36 4.32
TOCOM Gold 3316.00 -122.00 -3.55 1.75 75051
TOCOM Platinum 4600.00 -147.00 -3.10 5.00 28166
TOCOM Silver 53.90 -2.10 -3.75 4.26 652
TOCOM Palladium 1240.00 -51.00 -3.95 6.44 510
Euro/Dollar 1.4485
Dollar/Yen 91.01
TOCOM prices in yen per gram. Spot prices in $ per ounce.
(Additional reporting by Chikako Mogi; Editing by Edwina Gibbs)
