* Gold up 2 percent before dollar turns higher
* Hurricane Ike supports oil prices, underpinning gold
* U.S. bailout impact on commodities still uncertain
(Adds comments, updates prices, changes dateline PVS TOKYO)
By Anna Stablum
LONDON, Sept 8 (Reuters) - Gold jumped 2 percent on
Monday before a rising dollar capped further advances, but a
firm oil price supported precious metals.
Analysts digested the impact on commodities from a U.S.
bailout of two top mortgage lenders, which may encourage
investors to return to riskier assets.
"The dollar is at the fore ... if we see the dollar break
below $1.42 to the euro then gold will go swiftly under $800 an
ounce again," said analyst Tom Kendall at Mitsubishi.
Spot gold <XAU=> extended gains into a second session to
stand at $804.70 per ounce by 1021 GMT, up 0.45 percent from
$801.10 in late New York trade on Friday. Earlier it hit a high
of $817.40 -- up 2 percent before the dollar turned up.
Gold hit a year-to-date low of $773.90 on Aug. 15.
Earlier in the session gold was buoyed by the euro's <EUR=>
gains against the dollar, rising to around $1.4430, off an
11-month low of $1.4197 touched last week.
Crude oil <CLc1> gained $1 to around $107 a barrel,
rebounding from a five-month low on worries that Hurricane Ike
would tear through the Gulf of Mexico.
"The dependence on the oil price is most likely not going to
disappear in the next couple of days," said a Heraeus
Metallhandelsgesellschaft report.
Gold generally is seen as a hedge against oil-led inflation
and often moves in the opposite direction of the dollar as it
becomes cheaper for investors holding other currencies.
Analysts said gold's bounce on Monday appeared more likely to
be cautionary short-covering after a tumble from nearly $1,000 an
ounce in mid-July, with some uncertainty still lingering.
The outlook for gold remained bearish, but it could gather
safe-haven appeal with the outlook for the U.S. currency and the
economy unclear, traders said.
The market needed more time to see the impact of the U.S.
government's action regarding the two U.S. mortgage giants.
"It is a reason to be less bullish on the dollar, but not
bearish," Kendall said, adding that the knock-on effect on
commodities could be brief.
A firm U.S. currency makes dollar-priced commodities more
expensive to holders of other currencies and tends to cap
prices.
The U.S. government acted on Sunday to seize control of
mortgage finance companies Fannie Mae <FNM.N> and Freddie Mac
<FRE.N>, in a move that may temper the global financial market
turbulence that has threatened economic growth. []
"Gold has got far too many problems to contend with right
now ... the dollar for one, and oil ... the hurricane is only
giving short-term support," Kendall said.
Silver <XAG=> was firmer at $12.26/12.32 against
$12.19/12.27 in New York on Friday.
"Silver has been oversold relative to gold and that is
giving it a touch of support ... otherwise the market is mostly
taking its direction from gold," Kendall said.
Platinum <XPT=> strengthened to $1,357.50/1,377.50, up from
Friday's last quote of $1,353.00/1,373.00.
"Platinum looks relatively cheap between $1,300 and $1,400
an ounce," said the Heraeus report.
"We wouldn't rule out that the metal remains now
in a trading range between $1,275 and $1,525 for the remainder
of this year," it said.
(Additional reporting by Chikafumi Hodo, editing by Michael
Roddy)
