* Equities climb in Asia, Europe as risk appetite picks up
* Industrial commodities like oil, copper also benefit
* SPDR gold ETF sees fresh outflow as haven appeal wanes
(Updates prices)
By Jan Harvey
LONDON, July 9 (Reuters) - Gold held just below $1,200 an
ounce on Friday as some buyers were tempted back to the market
by the metal's fall to six-week lows, but recovering risk
appetite is undermining its haven appeal.
Spot gold <XAU=> was bid at $1,197.15 an ounce at 1109 GMT,
against $1,196.48 late in New York on Thursday. U.S. gold
futures for August delivery <GCQ0> firmed $1.10 to $1,197.20.
The metal has recovered after falling to its lowest since
late May on Wednesday at just above $1,185 an ounce, but has
since struggled to make new headway.
A return of appetite for assets seen as higher risk after a
cautiously upbeat view of the euro zone's recovery from the
European Central Bank and positive U.S. data released Thursday
is limiting demand for gold as a safe haven, analysts said.
"Sentiment is certainly changing and we should see thin
trading with gold lacking clear direction unless risk aversion
returns," said VTB Capital analyst Andrey Kryuchenkov.
"The exodus is finished in the short run... but more robust
gains on equity markets could trigger a little more downside,"
he added.
European shares extended a rally into a fourth session on
Friday, after Wall Street was boosted by falling jobless claims
and solid sales from a handful of large retailers. Asian shares
overnight posted gains. []
On the currency markets, the euro retreated after hitting a
two-month high against the dollar as improving risk demand
prompted European banks to pick up the currency. []
The euro has pared some of the hefty losses made against the
dollar this year in recent weeks, as concerns over euro zone
sovereign debt levels receded. []
ECB chief Jean-Claude Trichet's news conference after the
bank left rates on hold on Thursday may have been uneventful but
it ensured that the slowly rising enthusiasm for the euro was
not interrupted, Credit Agricole said in a note.
MAIN ETF SEES OUTFLOW
Elsewhere holdings of the world's largest gold-backed
exchange-traded fund, New York's SPDR Gold Trust <GLD>, slipped
again on Thursday, dipping 0.445 tonnes to 1,316.036 tonnes.
The fund's holdings have retreated 4.4 tonnes from the
record 1,320.436 tonnes they stood at in late June, as the safe
haven-related inflows seen in recent months dried up. []
After recent sessions' selling, gold is now looking
vulnerable from a technical perspective, according to analysts
who study charts of past price moves to determine the next
direction of trade.
"Gold is pressuring trendline support from the February lows
at $1,183 and is also capped by the $1,205/15 resistance area,"
said Barclays Capital. "Such price action is bearish."
Industrial commodities firmed, meanwhile, with oil climbing
nearly 0.5 percent in early European trade and copper up around
2 percent at its session highs. These assets are benefiting from
firmer risk appetite and the weaker dollar. [] []
Among the more industrial precious metals, silver prices
held broadly steady in line with gold, bid at $17.84 an ounce
against $17.89 late in New York on Thursday.
Holdings of the largest silver-backed ETF, the iShares
Silver Trust <SLV>, have also dropped just over 25 tonnes since
the end of June to 9,151.78 tonnes.
Platinum <XPT=> was at $1,520.30 an ounce against $1,517,
while palladium <XPD=> was at $449.33 against $445.50.
"Buying interest overnight and in Asia has seen platinum
recoup yesterday's weakness, as has palladium," said James
Moore, an analyst at TheBullionDesk.com, in a note.
"Short-term we expect further direction from broader
industrial commodity sentiment while favourable fundamentals
will provide ongoing background support," he added.
(Reporting by Jan Harvey; Editing by Keiron Henderson)
