(Updates to afternoon, adds activity in physical side)
By Lewa Pardomuan
SINGAPORE, Feb 13 (Reuters) - Gold extended losses on
Wednesday after a rise in stock markets and news of reduced
purchases by India ignited selling, while platinum fell as
investors booked profits at record high prices.
Gold <XAU=> hit a high of $909.70 an ounce on bargain
hunting but then dropped to $900.60/901.50 an ounce. It was
last quoted at $907.70/908.50 in New York on Tuesday -- off
from an all-time high of $936.50 it hit in early February.
"There are a few good factors coming back to the financial
markets. That's why people are off loading gold for now. It's
basically shifting funds from one financial market to another,"
said a dealer in Singapore.
"Warren Buffett has said he would like to reinsure all the
municipal bonds and that has given a boost to equity markets."
Billionaire investor Warren Buffett said on Tuesday he had
offered to reinsure $800 billion of muni debt guaranteed by
bond insurers, easing some worries about further fallout from
the credit crisis. []
In the physical sector, purchases from jewellers and
investors started to pick up as prices moved away from historic
highs, but business remained slow in main consumer India
despite the wedding season. []
India's gold imports in January slumped to just five tonnes
from 62 tonnes in the same month a year ago as a surge in
prices caps demand, according to the Bombay Bullion
Association. []
But dealers said investment buying, record-high crude oil
<CLc1>, volatile stock markets, a struggling U.S. dollar and
the prospect of more interest rate cuts in the United States
would offer support for gold.
"It certainly will be possible for the gold price to spike
still higher. I think it's premature to say that we've seen the
peaking gold prices," said David Moore, a commodity analyst at
the Commonwealth Bank of Australia in Sydney.
"There's still some investor interest in gold," he said.
Tokyo's Nikkei share average <> closed 0.4 percent
higher on Wednesday, giving up most of its earlier gains as
investors avoided making major bets ahead of Japanese and U.S.
economic data.
Economists polled by Reuters estimate U.S. retail sales
slipped 0.2 percent in January after a 0.4 percent decline in
December, but rose 0.2 percent with auto transactions excluded.
[]
"The market may be at the lower range for the week. There's
a good chance we will bounce off from the $900 level and try
$935 again," said William Kwan, a dealer at Phillip Futures in
Singapore.
"Platinum is also hit by profit-taking," he said.
Platinum <XPT=> fell to $1,905/1,910 an ounce from
$1,920/1,925 in New York on Tuesday, when it rallied to a
record high of $1,965 on supply concerns in South Africa after
a power crisis disrupted mining in the world's main producer.
Japanese platinum futures were also off record highs, with
the most active December contract <0#JPL:> on the Tokyo
Commodity Exchange falling 108 yen per gram lower at 6,275 yen.
COMEX's April gold futures <GCJ8> fell $7.0 an ounce to
$904.1 an ounce.
Palladium <XPD=> fell to $423/427 an ounce from $434/437 an
ounce late in New York and off Tuesday's 6-year high of $447 an
ounce.
Silver <XAG=> fell to $16.97/17.02 an ounce from
$17.13/17.18 in New York -- off Tuesday's 27-year high of
$17.60 an ounce.
Precious metals prices at 0726 GMT
Metal Last Change Pct chg YTD pct chg
Turnover
Spot Gold 900.70 -5.30 -0.58 8.17
Spot Silver 16.96 -0.21 -1.22 14.83
Spot Platinum 1905.00 -5.00 -0.26 25.33
Spot Palladium 423.00 -11.00 -2.53 14.95
TOCOM Gold 3124.00 -75.00 -2.34 2.09
89785
TOCOM Platinum 6266.00 -117.00 -1.83 17.36
63993
TOCOM Silver 587.80 -21.10 -3.47 8.65
1354
TOCOM Palladium 1481.00 -80.00 -5.12 9.62
5536
Euro/Dollar 1.4566
Dollar/Yen 107.09
TOCOM prices in yen per gram, except TOCOM silver which is
priced in yen per 10 grams. Spot prices in $ per ounce.
(Editing by Michael Urquhart)
