* Gold falls further on profit taking but sentiment
positive
* ETF holdings hit new record above 850 tonnes
* Jewellers sidelined due to high prices
* Nikkei eases, oil steady and euro slips
(Updates prices, activity in physical sector)
By Lewa Pardomuan
SINGAPORE, Feb 3 (Reuters) - Gold extended losses on
Tuesday, after posting its biggest daily percentage fall in
three weeks the previous day because of profit taking, but
record exchange traded fund holdings still boosted sentiment.
The world's largest gold-backed exchange-traded fund, the
SPDR Gold Trust <GLD>, said holdings rose 9.78 tonnes to a new
record of 853.37 tonnes as of Feb. 2 -- an increase of more
than 9 percent in the past month. []
Gold <XAU=> was trading at $900.75 an ounce, down $2.40
from New York's notional close on Monday, when it dropped more
than 2 percent in selling also driven by weak demand from the
jewellery sector.
In the physical sector, sales of gold scraps picked up in
Asia after bullion prices rallied to their highest in nearly
four months above $930 last Friday, turning off buyers in main
consumer India during the wedding season. []
"At current levels, some of the fabrication demand for gold
might fall away and you might also get some selling of gold,"
said David Moore, commodities strategist at Commonwealth Bank
of Australia in Sydney.
"My expectation is that gold would trade in a fairly broad
band but around about the sort of current levels. Sentiment
towards gold is relatively positive at the moment. I suppose
the international economic problems are creating interest in
gold as a sort of diversification for investors."
For details of gold holdings by the ETF listed in New York,
click on:
https://customers.reuters.com/d/graphics/MKTS_SPDRGLD0209.jpg
Gold has bounced more than 30 percent since tumbling to a
13-month low of around $680 in late October, aided by a
recovery in oil prices, technical buying and investors looking
for a safe place to park their assets awayfrom the volatile
equity markets.
But high prices also scared off buyers from the jewellery
sector, which accounts for almost 70 percent of global demand
for gold. Gold was about 12 percent below a lifetime high of
$1,030.80 struck last March.
The volume of gold jewellery sales in Abu Dhabi fell 70
percent in January due to rising prices. []
"Basically, there's not much interest from the jewellery
sector and there's profit taking as well as light selling in
Asia," said a dealer in Hong Kong.
"But we can still see bargain hunting at lower levels.
That's why we also see a rebound, which is driven by bargain
hunters," said the dealer, referring to a drop to an intraday
low of $895.60 an ounce.
In other markets, the Nikkei <> fell 0.6 percent on
poor earnings outlooks. []. Oil was steady above $40 a barrel
after falling nearly 4 percent the previous session as U.S.
data ignited concerns over the economy and demand in the United
States. []
The euro edged down to $1.2839 <EUR=> on Tuesday, having
gained on expectations the European Central Bank will keep
interest rates steady later this week and maintain the
currency's yield appeal. []
Worries about the global economy persisted after data
showed U.S. consumption, which accounts for two-thirds of the
country's economy, fell for a sixth straight month in December.
A separate report pointed to continued weakness in U.S. factory
activity in January. [].
New York gold futures <GCJ9> fell $4.4 to $902.8 an ounce
in electronic trade.
Platinum <XPT=> was trading at $968 an ounce, down $2 from
New York's notional close.
PRICES
Metal Last Change Pct chg Day ago pct MA 30
RSI Spot gold $900.75 -$2.40 -0.27% +0.42% $860.10
59
Spot silver $12.34 -$0.03 -0.24% +3.01% $11.29
69
Spot plat $968.00 -$2.00 -0.21% -1.78% $958.70
58
COMEX gold $902.80 -$3.80 -0.42% -2.68% $863.97
60
TOCOM gold 2,605 -25 -0.95% -1.03% 2,497
66
TOCOM plat 2,798 -14 -0.50% +0.14% 2,696
60
Currencies
Euro/dlr $1.285 -$0.029 -2.21% -2.51%
Dlr/yen 89.72 -0.66 -0.73% +0.90%
(Editing by Michael Urquhart)
