(Adds details, updates prices)
* Spot inches down to under $960 an ounce
* Impetus for further rise meagre as bargain hunting peters
By Miho Yoshikawa
TOKYO, Feb 25 (Reuters) - Gold crept down to hover below
$960 on Wednesday after a bout of bargain hunting, triggered by
the previous session's over 2 percent decline, ran out of
stream.
Traders said sentiment had turned slightly softer after the
market's failure to breach an 11-month high above $1,000 an
ounce hit last week.
Spot gold <XAU=> was trading at $957.55 an ounce around
0633 GMT, down 0.5 percent from New York's notional close on
Tuesday.
"We saw some bargain hunting at the lower level at the
open," said Peter Tse, a dealer at Scotia Mocatta in Hong Kong.
He said although prospects for a further rise in gold
continued to look bright, he would not be surprised if it
dipped to a low of about $940 in the near term.
A dealer based in Hong Kong agreed that gold could ease in
the short term.
"Sentiment has changed a bit since it hasn't moved beyond
last week's high above $1,000 ... and I think there might be
some consolidation," he said.
On Tuesday, gold's failure to revisit last week's high
above $1,000 triggered a bout of profit taking by short-term
investors.
Gold's losses accelerated after Federal Reserve Chairman
Ben Bernanke said inflation pressures had receded dramatically
as oil and commodity prices had fallen and slack had built up
in the economy, denting gold's appeal as an inflation hedge.
Bullion was also pressured after U.S. stocks rallied 4
percent following Bernanke's comments that signalled that the
nationalization of major banks was not at hand, showing that
investors were shifting funds into riskier assets.
[] []
Gold showed little reaction to U.S. President Barack
Obama's speech, his first to a joint session of Congress, in
which he tried to strike a delicate balance between hope and
reality. []
"It was pretty neutral as far as financial markets are
concerned," said Koji Suzuki, senior analyst at SBI Futures Co
Ltd.
"It's early days yet for the president ... we'll have to
see what happens after the first three months," he said.
Indicating that investor interest may have paused for the
time being, holdings of SPDR, the world's largest gold-backed
exchange traded fund, remained unchanged at a record high
1,028.98 tonnes on Feb. 24, a level it first touched on Feb.
19. []
In currency markets, the yen fell across the board on
Wednesday, hitting a fresh three-month low against the dollar
as its perceived safe-haven status continued to crumble on a
rapidly weakening Japanese economy and domestic political woes.
[]
(Additional reporting by Chikako Mogi; Editing by Ben Tan)
