* Gold holds below $900/oz
* Stock rally dulls gold's sheen for risk-averse investors
By Miho Yoshikawa
TOKYO, March 11 (Reuters) - Gold was little changed on
Wednesday, hanging below $900 as investors took a break from
their aversion to risk amid a global stock market rally that has
eased fears about the economic crisis.
The precious metal fell below $900 for the first time in a
month on Tuesday as U.S. equities jumped from 12-year lows led
by financial stocks.
Japanese shares climbed on Wednesday, with the Nikkei
average jumping 4 percent after booking a 26-year closing low
the previous day. []
"On the one hand we've got a weakly U.S. dollar, which we
would have expected to benefit gold, but on the other hand of
course the very strong recovery -- temporary perhaps -- in the
stock market that has meant an unwinding of risk aversion," said
Darren Heathcote of Investec Australia.
The dollar dipped against the euro on Wednesday after a
rally in U.S. shares on news that Citigroup was profitable in
the first two months of 2009, tempering safe-haven buying of the
dollar. []
Spot gold <XAU=> was at $895.0 an ounce as of 0252 GMT, down
0.1 percent from New York's notional close on Tuesday, after
moving between $891.55 and $897.20.
Gold is now down more than 10 percent from the 11-month high
above $1,000 marked on Feb. 20. It hit a record of $1,030.80 in
March last year.
Heathcote said gold was likely to consolidate around current
levels as the decline had not gained momentum after breaking
below $900.
"I would expect we'll see some consolidation, and much of
the focus (will be) on what happens across the various stock
markets in the coming days," he said.
Waning investor interest was also reflected in the
relatively steady volume in holdings of the exchange-traded
fund, which jumped by some 200 tonnes in the first six weeks of
the year, matching bullion's rally.
The world's largest gold-backed exchange-traded fund, the
SPDR Gold Trust <GLD>, said holdings stood at 1,028.99 tonnes as
of March 10, unchanged from March 8, when it edged down from its
record high of 1,029.29 tonnes for the first time since January.
[]
UBS said in a research note on Tuesday that it believes gold
could hit $2,500 an ounce in the next five years if the dollar
weakens further and inflation volatility continues.
[]
The chief executive of Barrick Gold Corp <ABX.TO>, the
world's largest gold producer, said on Tuesday industry supply
of the metal will continue to fall, and the price of gold will
remain volatile in the near term. []
Aaron Regent, Barrick's CEO, was speaking at the Reuters
Global Mining and Steel Summit in New York on Tuesday.
Precious metals prices at 0256 GMT
Metal Last Change Pct chg YTD pct chg
Turnover
Spot Gold 894.00 38.45 +4.49 1.57
Spot Silver 12.54 1.16 +10.19 10.78
Spot Platinum 922.50 -3.50 -0.38 -1.02
Spot Palladium 182.00 0.00 +0.00 -1.36
TOCOM Gold 2447.00 -12.00 -0.49 -4.90 19496
TOCOM Platinum 2619.00 -38.00 -1.43 -1.24 6596
TOCOM Silver 321.60 0.00 +0.00 0.72 117
TOCOM Palladium 524.00 -12.00 -2.24 -4.73 182
Euro/Dollar 1.2703
Dollar/Yen 98.42
TOCOM prices in yen per gram, except TOCOM silver which is
priced in yen per 10 grams. Spot prices in $ per ounce.
(Additional reporting by Risa Maeda; Editing by Hugh Lawson)
