Beiträge von GoldenCentury

07 Jan 2005 13:18

07.01.2005 12:09:23 Europe gold edges higher, awaits U.S. jobs data

LONDON, Jan 7 (Reuters) - Gold prices moved slightly higher in Europe on Friday, bouncing off a two-month low hit overnight as the focus moved to U.S. jobs data due out later in the day.

Traders said gold had moved back above $420 an ounce in line with a slightly weaker dollar.

But they did not rule out further selling despite the more positive tone in the market.

By 1051 GMT spot gold had moved up to $423.00/423.75 a troy ounce versus $420.95/421.70 in late New York trading on Thursday.

"It's feeling a little more positive. We plumbed the depths and held the $420 level. I think the dollar is a bit over-stretched after a week of euro and gold selling," one trader said.

"Although who knows what will happen with the jobs data."

The U.S. non-farm payrolls for December, due at 1330 GMT, are the first major figures to be released this year. An improvement in the job market could cement expectations of more U.S. interest rate rises.

That could be positive for the dollar and so negative for gold as it would enhance the appeal of the U.S. currency and possibly suck more fund money out of commodities.

Alan Williamson, analyst with HSBC Bank, said in his daily report that further weakness in gold could not be ruled out, noting talk of large stop-loss sell orders around $419.

Gold dipped briefly below $420 on Thursday to touch $419.90, but then attracted buying and changed tack.

"We continue to believe that any further weakness in gold will prove short-lived and that recent activity merely reflects a retracement, not a reversal in the long term gold rally," Williamson said.

James Moore, analyst with TheBullionDesk.com, said in a daily report that a positive payrolls report might trigger further liquidation in gold, with the potential to push prices as far as $409 -- the lowest since mid-October 2004.

But his longer-term view remained positive so long as gold held that level.

"The continued U.S. trade/current account deficits and the prospect of further Middle East violence ahead of the presidential elections in Iraq...increase the safe haven interest in gold," he said.

Other precious metals were mostly stable.

Traders said silver had been relatively steady after gold's decline and noted physical buying at current levels.

Spot silver rose to $6.46/6.48 an ounce from $6.42/6.45.

Platinum gained to $845.00/849.00 from $843.00/848.00 and was seen trading in a broad $825-875 range, while palladium was indicated at $180.00/183.00 from $178.50/184.50.

07 Jan 2005 10:04

07.01.2005 08:54:57 Tokyo gold near 4-month low, funds buy platinum

TOKYO, Jan 7 (Reuters) - Tokyo gold futures fell to their lowest levels since mid-September on Friday as traders slashed positions further amid nervousness about influential U.S. jobs data that could push up the dollar.

The strength of the dollar against the yen is usually positive for yen-denominated gold futures as their value rises in the Japanese currency, but the market is now more focused on falls in the dollar-based spot price.

Spot gold has been pressured by the dollar's uptrend against other major currencies since the start of the year.

Gold found some ground as bargain hunters flocked into the physical market, but speculators were keen to hammer it down to the next support amid deteriorating short-term technical trends.

"The near-term trend looks bearish because of the dollar," said Koji Suzuki, manager at Star Futures Securities.

"But the market doesn't want to sell too heavily as the long-term outlook for the dollar is still bearish and traders are also worried about the Iraqi elections."

The December gold futures contract on the Tokyo Commodity Exchange (TOCOM) closed down 13 yen per gram at 1,425 yen. It fell as low as 1,421 yen, the lowest since Sept. 13.

Other contracts closed down 12 to 16 yen.

The December contract has lost more than 4 percent since Dec. 28, the final trading session on TOCOM last year.

Spot gold was off a two-month low, standing at $421.80/2.30 per ounce as of 0733 GMT, against $420.90/1.70 in New York.

But speculators were keen to test it down towards a 200-day moving average of $410.23.

The market will be watching how the dollar moves after the U.S. payroll figures as a clue to the trend for gold.

Economists expect the U.S. non-farm payrolls data, due at 1330 GMT, to show an increase of around 175,000 jobs in December, better than the 112,000 in November.

The dollar was quoted at $1.3183/90 against the euro , compared with its record low of $1.3670 hit on Dec. 30.

It was at 104.63/66 yen , up about 2 yen since the start of the year.

TOCOM platinum futures rebounded from lows, with most contracts ending higher on buying by hedge funds.

"Although the amount of purchase was not big, the market was supported after seeing buying by hedge funds," said a senior trader at a Japanese commodities brokerage.

"The upward move could have been exaggerated because the market was thin, but it looks like the December contract is now supported around 2,700 yen," he said.

December platinum closed 4 yen per gram higher at 2,754 yen. It moved in a range of 2,740 to 2,763 yen.

Other contracts closed down 2 yen to up 7 yen.

Below are closing prices for TOCOM's most active precious metals contracts, with the day's turnover for each metal.

Closing prices are in yen per gram except for silver, which is in yen per 10 grams:

Closing price Turnover (lots)
GOLD 1,425 (down 13) 97,495
SILVER 216.8 (down 1.9) 3,538
PLATINUM 2,754 (up 4) 26,673
PALLADIUM 610 (unchanged) 461

06 Jan 2005 20:57

06.01.2005 20:54:38 NY gold hits 2-1/2-mo. low, focus on US jobs data

NEW YORK, Jan 6 (Reuters) - U.S. gold futures closed at 2-1/2-month lows Thursday on a third day of heavy liquidation fueled by this week's rallying dollar, which was capping global demand for the precious metals.

Few buyers have stepped in as gold slipped while the dollar gained strength, and dealers said that, with prices nearing key support of $420 an ounce, many traders sat back to await Friday's influential U.S. monthly jobs report for further direction.

February delivery gold shed $5.70 to end at $421.60 an ounce on the New York Mercantile Exchange's COMEX division, after dealing between $428.30 to $421.10, and hitting its weakest close since Oct. 18.

Futures have lost about $16, or 4 percent, since the start of the year, in what dealers said was persistent selling by gold traders reacting to a more robust U.S. currency.

"It's more liquidation in gold, with a possible test of $420" in the near term, said James Quinn, a commodities commentator at A.G. Edwards & Sons.

"It's positions being reduced," said gold desk trader. "There is nothing really new. The market looks like it's seeing scale-down selling consistently through the day. Every rally seems to be sold, and that seems to be the pattern."

The euro sagged to around $1.3170, down slightly from late New York levels Wednesday.

A stronger U.S. currency makes dollar-priced metals less attractive to non-U.S. investors.

Nonfarm payrolls for December, due to be issued Friday morning, were expected to be up 175,000 in December.

Spot gold priced at $420.95/1.70 an ounce, way down from Wednesday's late New York quote at $427.65/8.40. Thursday's late London fix was at $424.35.

Many, but not all, analysts are upbeat on gold over the longer-term.

Andy Smith of Mitsui Global Precious Metals said "cycle" strength in gold, and the commodities sector generally, may be flagging after the huge rise in open interest they enjoyed in November, when U.S. investment banks were buying before their financial year-end.

In his weekly metals note, Smith also suggested that the build-up in bullion held in the U.S. gold exchange-traded fund streetTRACKS appeared to have leveled out following its much-hyped launch on Nov. 18 on the New York Stock Exchange.

As of Jan. 5, the ETF's holdings in bullion stood at 109.14 tonnes for the second straight day -- about 6 tonnes above the peak immediately after the launch, when investors were juicing gold prices to 16-year highs.

COMEX gold futures peaked at $458.70 on Dec. 2.

In other metals, March silver fell 8 cents to $6.455 an ounce, after trading $6.565 to $6.41. Prices are near three-month lows.

Spot silver was quoted at $6.42/45, below its prior New York close at $6.53/56. The fix was at $6.42.

April platinum lost $7.20 to $845.10 an ounce. Spot platinum eased to $843/848.

March palladium rose 45 cents to $183.75 an ounce. Spot dipped to $178.50/184.50.

06 Jan 2005 18:53

06.01.2005 17:42:13 Commodities News Summary

TOP NEWS
> NY gold tumbles early, eyes on $420 support level [nN06398842]

NEW YORK - U.S. gold futures plunged to two-month lows Thursday morning on fund liquidation, and other precious metals mostly fell, trailing the euro, which hit a four-week low against the resurgent dollar, dealers said.

- - - -

> Europe gold ends near two-month low on firm dollar [nL06366268]

* Spot gold weakens to close in Europe at $422.00/422.75 per troy ounce by 1615 GMT versus $427.65/428.40 in New York late on Wednesday.

- - - -

> COMEX copper falls in consolidative tussle [nN06401701]

NEW YORK - COMEX copper futures swung from lower to higher ground Thursday morning as players sorted out direction following Tuesday's biggest one-day drop in memory which left many players sidelined, while others hunted for bargains, traders said.

- - - -

> UPDATE 3-India releases sugar to ease prices [nL06179534]

NEW DELHI - India announced the release of 400,000 tonnes of sugar to the market and sugar policy reforms on Thursday to counter a surge in domestic prices.

- - - -

GRAINS/OILSEEDS/LIVESTOCK
> EU set to lift partial ban on Argentine beef [nL06336936]

BRUSSELS - The European Union is likely next week to lift its ban on beef imports from northern Argentina, imposed in 2003 due to an outbreak of foot-and-mouth disease (FMD), European Commission officials said on Thursday.

- - - -

> EU likely to extend Asia poultry ban to end-June [nL06317983]

BRUSSELS - The European Union is likely to extend its ban on poultry imports from seven Asian nations until the end of June due to uncertainty that deadly bird flu disease is under control in the region, officials said on Thursday.

- - - -

> UPDATE 1-Poland to add up to 700,000T of grain to [nL06681011]

WARSAW - Poland will likely add some 600-700,000 tonnes of grains to European Union intervention stocks by the end of the 2004-2005 season, the state-run Farm Market Agency (ARR) estimated on Thursday.

- - - -

> Israeli firm buys S.American corn - trade [nL05395200]

HAMBURG - An Israeli private buyer has purchased about 48,000 tonnes of South American corn and 7,000 tonnes of soymeal in a tender which closed on Wednesday, traders said on Thursday.

The buyer rejected bids for sorghum and made no purchase.

- - - -

> WRAPUP 2-Malaysia banishes bird flu, but Vietnam t [nSP196278]

HANOI/KUALA LUMPUR - Malaysia declared itself free of bird flu on Thursday, but another death prompted Vietnam to step up its fight against the virus that has killed 34 people across Asia and ravaged the region's poultry industry.

- - - -

METALS
> Stock rise rattles zinc, but impact seen limited [nL06159203]

LONDON - A hefty increase in zinc stocks will likely put more pressure on metal prices already reeling from fund sell-offs this week, analysts said on Thursday.

- - - -

> Zambia copper mine starts up, sees 105,000T in '05 [nL06309691]

LUSAKA - Zambia's Kansanshi Copper Mine, majority owned by Canada's First Quantum (/FM.TO), has started production and will turn out 105,000 tonnes of copper this year, a senior mine official said.

- - - -

> UPDATE 2-Harmony, Gold Fields to meet in Moscow th [nL06384778]

JOHANNESBURG - South Africa's Harmony Gold (/HARJ.J) said on Thursday talks with its $5.5 billion takeover target, Gold Fields Ltd. (/GFIJ.J), would resume later this month in Moscow to attempt to find alternatives to the hostile bid.

- - - -

> Europe copper premiums steady but direction unsure [n]

LONDON - European copper premiums were steady at the start of 2005, but there was uncertainty about which direction the spot market would take in the first quarter, traders said.

- - - -

> UPDATE 1-Euronext in carbon emissions exchange par [nL06141932]

AMSTERDAM - Pan-European bourse operator Euronext (/ENXT.PA)(/ENXT.AS) plans to set up a European carbon emissions exchange with partners Powernext and Caisse des Depots et Consignations within months, the parties said on Thursday.

- - - -

SOFT COMMODITIES > Bulgarian sugar workers mount protest in quota row [nL06432583]

SOFIA - Some 250 sugar-mill workers protested in central Bulgaria on Thursday after their company missed out on a large part of a 250,000-tonne low-tariff sugar import quota, officials said.

- - - -

> Kenya to allow coffee farmers to export directly [nL06685900]

NAIROBI - Kenya said on Thursday it would allow coffee farmers to bypass a central auction and export directly to buyers abroad, a reform farmers have sought for many years.

- - - -

06 Jan 2005 18:38

06.01.2005 17:27:41 NY gold tumbles early, eyes on $420 support level

NEW YORK, Jan 6 (Reuters) - U.S. gold futures plunged to two-month lows Thursday morning on fund liquidation, and other precious metals mostly fell, trailing the euro, which hit a four-week low against the resurgent dollar, dealers said.

By 10:42 a.m. EST (1542 GMT), February delivery gold slid $4.30 to $423 an ounce on the New York Mercantile Exchange's COMEX division, dealing between $428.30 and $422.20, its cheapest price since Nov. 3.

Gold has shed about $25 since late December and dealers said price action was a continuation of the speculative selling sparked by a falling euro, which limited the metal's demand from overseas traders.

The market could be heading for a test of a key round-number support level in the near-term, traders said.

"It's more liquidation in gold, with a possible test of $420," said James Quinn, commodities commentator at A.G. Edwards & Sons.

A gold desk trader said: "It's positions being reduced. There is nothing really new. The market looks like it's seeing scale-down selling consistently through the day. Every rally seems to be sold, and that seems to be the pattern."

Spot gold slid to $421.80/2.60 an ounce, down from Wednesday's late New York quote at $427.65/8.40. Thursday's afternoon London fix was down at $424.25.

The euro sagged to around $1.3170, down slightly from late New York levels Wednesday.

Gold has a high correlation with the euro and tends to move inversely with the dollar.

Many, but not all, analysts are mixed on gold in the longer term, amid expectations for continuing safe-haven buying due to concerns about the dollar, giant U.S. deficits, geopolitical worries and inflation concerns.

But Andy Smith of Mitsui Global Precious Metals said "cycle" strength in gold, and the commodities sector generally, may be flagging after the huge rise in open interest they enjoyed in November, when U.S. investment banks were buying before their "financial" year-end.

In a weekly metals note, Smith also suggested that the build-up in bullion held in the U.S. gold exchange-traded fund streetTRACKS appeared to have leveled out following its much-hyped launch on Nov. 18 on the New York Stock Exchange.

As of Jan. 5, the ETF's holdings in bullion stood at 109.14 tonnes for the second straight day -- about 6 tonnes above the peak immediately after the launch, when investors were juicing gold prices to 16-year highs.

COMEX gold futures hit $458.70 on Dec. 2.

The dollar trimmed some gains after a report showed a jump in weekly U.S. unemployment benefit claims on the eve of Friday's influential monthly U.S. jobs report.

Claims were 364,000, above forecasts for 331,000. Analysts said the dollar gave up only a little ground because the weekly data is notoriously volatile. The report, however, did seem to signal a softer labor market than anticipated.

Other precious metals fell with gold.

March silver sank 8.5 cents to $6.45 an ounce, trading $6.565 to $6.41. Prices are close to three-month lows. Spot silver fetched $6.42/45, below its last New York close at $6.53/56. The fix was down at $6.42.

April platinum shed $5.50 to $846.80 an ounce. Spot platinum hit $846/851.

March palladium rose 10 cents to $183.40 an ounce. Spot held at $179/184.

06 Jan 2005 18:22

06.01.2005 17:03:46 UPDATE 1-Europe gold touches two-month low on strong dollar

(Updates to afternoon)

LONDON, Jan 6 (Reuters) - Gold slid to its lowest in two months in Europe on Thursday and may be poised to drop further as its investment appeal was knocked by dollar strength, dealers said.

Spot gold was at $422.00/422.80 per troy ounce by 1553 GMT, down from late New York's $427.65/428.40.

It touched a low of $420.90 -- last seen in early November.

Bullion prices gave way amid technical selling, with the market still seeking stability after fund-led falls earlier this week as the dollar started its fightback from a record low against the euro.

"We have come down a fair bit, even though daily charts are showing the market as oversold, because everyone is taking their cue from the dollar/euro," one dealer said.

"This is possibly a good place to take a long position and sit with it," he added.

Others said the market might fall further before stabilising, with $410 seen as the next big support level.

The dollar pared gains but remained up on the day versus the euro after a report showed a jump in U.S. jobless claims.

A stronger U.S. currency makes dollar-priced bullion less attractive for non-U.S. investors.

U.S. non-farm payroll figures due on Friday are the next major factor in determining whether the dollar will extend its rally or resume an overall three-year downtrend driven by worries about the current account and budget deficits of the world's biggest economy.

Economists polled by Reuters said 175,000 jobs were probably created in December, up from November's disappointing 112,000 gain.

James Moore of TheBullionDesk.com remained upbeat on the longer-term outlook for bullion, citing economic and geopolitical worries as supportive factors.

"The prospect for gold is still positive with continued violence in Iraq ahead, its presidential elections at the end of the month, the G7 summit, President Bush's State of the Union address and U.S. deficits all increasing the safe-haven argument for gold," he said.

The world's largest gold producer, Newmont, was also upbeat given expectations for the dollar to continue falling against the euro. (For full story click on [nN05521033]

Silver eased with gold to $6.43/6.46 from $6.53/6.58 in New York on Wednesday.

Traders said price were holding support relatively well and had technical and physical backing.

Platinum edged higher to $846.00/851.00 from $845.00/850.00, while palladium slipped slightly to $178.00/183.00 from $179.00/185.00.

06 Jan 2005 18:19

06.01.2005 17:06:47 Europäische Anleger verschmähen Gold

Zürich, 06. Jan (Reuters) - Gold hat den negative Trend der vergangenen Tage auch am Donnerstag nicht abschütteln können. Vor allem der weiter anziehende Dollar habe den Goldkurs in die Knie gezwungen, sagte ein Händler. Doch könnte die derzeitige Konsolidierung nach den Höchstständen von Ende 2004 auch den Beginn einer längeren Abwärtsphase markieren. Mit einem Fall unter die Marke von 424 Dollar sei die Tür für viel grössere Verluste bis auf 410 Dollar aufgestossen, so ein Händler.

Zum Handelsschluss stand die Feinunze Gold bei 422,80/423,55 Dollar nach 426,30/427,00 Dollar am Vortag. In London wurde das Edelmetall am Nachmittag bei 424,35 Dollar und am Vormittag bei 425,80 gefixt. Am Mittwochnachmittag lautet das Fixing auf 426,00 Dollar.

Andere Marktkenner geben sich dagegen für die langfristigen Goldaussichten optimistisch und verwiesen auf die anhaltenden geopolitischen und ökonomischen Unsicherheiten. Die steigende Zahl der Anschläge vor den Wahlen im Irak Ende Januar und das weiter anschwellende US-Doppeldefizit sollten Gold als "safe heaven"-Investment zu Gute kommen.

Mit Spannung erwarten die Marktteilnehmer zunächst aber die am Freitagnachmittag anstehenden US-Arbeitsmarktdaten für Dezember.

Eine Schweizer Grossbank gab den Gold-Kilopreis mit 15.825/16.075 (Vortag 15.920/16.170) sfr an.

pma/och

06 Jan 2005 18:03

06.01.2005 16:41:04 Miners power S.African stocks to new record high

JOHANNESBURG, Jan 6 (Reuters) - South African stocks scored an historic closing high on Thursday as investors grabbed heavyweight miners on a weaker rand but capped the rally by dumping recent winners in telecoms, banking and retail.

Johannesburg's bluechip top 40 index (/.JTOPI), one of the world's top performing stock markets last year, rose 1.16 percent to 11,544.59 points. The all-share index (/.JALSH) gained 0.97 percent to 12,800.52 points.

"There's been a big sector rotation on the weaker rand with everyone switching from telecoms, retailers and financials into resources," said one dealer. "Gold and platinum stocks are really flying." South Africa's rand slid by 4 percent to a two-month low against the recovering dollar, with weaker gold prices adding to the pressure as nervous markets wait for key U.S. jobs data for more direction.

Bourse volumes were around 2.7 billion rand ($457 million) shortly before close of play -- still below average and making for greater volatility, but rebounding from the paltry levels seen over the Christmas break, dealers said.

Miners dominated the day.

Warring gold producers Harmony (/HARJ.J) and Gold Fields (/GFIJ.J) jumped 8.9 and 8.53 percent, after predator Harmony told Reuters the two firms would resume talks aimed at settling an acrimonious and expensive takeover battle later this month.

Platinum producers Anglo American Platinum (/AMSJ.J) and Impala Platinum (Implats) (/IMPJ.J) gained 5.93 and 7.95 percent respectively. Heavyweight diversified mining firm BHP Billiton (/BILJ.J) gained 4.89 percent while its rival Anglo American (/AGLJ.J), South Africa's biggest company, added 3.81 percent.

On the downside, telecoms and some financials fell as investors switched capital into resource stocks.

"People were caught off guard on the weaker rand and found themselves overweight in telecoms and financials," said one telecoms analyst. "Plus telecoms have fared well recently and Telkom is starting to look fairly well priced now."

Africa's biggest telecoms company Telkom (/TKGJ.J) fell 3.88 percent while cell phone operator MTN (/MTNJ.J) slid 4.95 percent.

The banking index (/.JBNKS) shrank by 2.74 percent. Firstrand (/FSRJ.J) fell 4.35 percent while banking rivals Absa (/ASAJ.J) and the country's biggest bank by assets, Standard Bank (/SBKJ.J), fell 2.46 percent and 2.16 percent.

Retailers also took a hit as Woolworths (/WHLJ.J) posted a smaller-than-expected rise in first-half turnover amid slightly disappointing sales of clothes and homeware over Christmas. The stock fell 3.14 percent.

Home furnishing retailer Edgars Consolidated Stores (Edcon) (/ECOJ.J) -- one of 2004's top performers -- was the biggest loser, shedding 6.17 percent. Supermarket chain Pick 'n Pay (/PIKJ.J) slipped 1.77 percent.

"There have been whispers that Christmas sales in the sector as a whole weren't as good as expected and since people have made so much money on these stocks they are seizing on excuses to get out now," said one dealer.

($1=5.913 Rand)

06 Jan 2005 10:05

06.01.2005 08:58:10 Tokyo gold falls as firm dollar hurts sentiment

TOKYO, Jan 6 (Reuters) - Tokyo gold futures dropped on Thursday as the recent recovery of the dollar depressed the market's underlying trend and prompted investors to lighten positions further in the yellow metal.

Investors were keen to square their positions ahead of the release of U.S. payroll data on Friday as the strength of the dollar has been weighing on the dollar-based spot price and pressuring gold futures on the Tokyo Commodity Exchange (TOCOM).

Speculators sold gold on vague rumours that international monetary bodies may come up with plans to provide financial assistance for Asian tsunami-hit countries that would be funded with proceeds from gold sales, traders said.

"There are still many long positions held above 1,450 yen and holders are willing to unwind them," said Tatsuo Kageyama, analyst at Kanetsu Asset Management.

"The dollar's recent recovery has been hurting the trend in the short term, but the medium- and long-term outlooks for gold remain strong."

The December TOCOM gold contract closed 4 yen lower at 1,438 yen a gram. It had moved in a range of 1,431 to 1,438.

Other contracts settled down 1 to 5 yen.

At 0726 GMT, spot gold was quoted at $425.75/6.50 an ounce, against $427.65/8.40 last quoted in New York.

Traders said falls in gold would be limited as there was a sizeable bargain-hunting appetite for physical gold.

"Sharp falls from the present level are unlikely as demand for physical gold is expected to lend support," said Akira Doi, director at Daiichi Commodities Co. Ltd.

"I think we are now seeing a very healthy correction."

Traders said Japanese investors were also keen to diversify into gold ahead of the end of a government guarantee on bank deposits at the end of March.

In the near term, however, gold and other precious metals were seen vulnerable to a further downside correction amid concerns that the greenback may rise again should the U.S. jobs data turn out to be strong, traders said.

Economists polled by Reuters said 175,000 jobs were likely created in December.

The dollar was well off its lows against major currencies.

It was quoted at $1.3230/36 against the euro , more than 3 percent above its record low of $1.3670 hit on Dec. 30, according to data from electronic trading platform EBS.

The U.S. currency was at 104.53/56 yen , up slightly from 104.14 yen in late New York, and up nearly 2 yen since the start of the year.

TOCOM platinum was mostly down, but lacked clear direction with the market mainly driven by moves in the yen and gold.

December platinum closed down 3 yen per gram at 2,750 yen. It had moved in a range of 2,726 to 2,761 yen.

Other contracts closed flat to down 8 yen, with the exception of the spot February, which rose 12 yen.

Below are closing prices for TOCOM's most active precious metals contracts, with the day's turnover for each metal.

Closing prices are in yen per gram except for silver, which is in yen per 10 grams:

For open interest details please click

Closing price Turnover (lots)
GOLD 1,438 (down 4) 62,934
SILVER 218.7 (up 1.9) 3,590
PLATINUM 2,750 (down 3) 31,425
PALLADIUM 610 (up 5) 577

05 Jan 2005 17:45

05.01.2005 17:29:02 Europe gold ends flat, pressured by dollar rally

* Spot gold eases to end flat in Europe on Wednesday at $427.60/428.30 per troy ounce by 1615 GMT.

* Market attempts to consolidate above Tuesday's two-month low of $423.55, but under pressure still from dollar strength.

* Euro last at $1.3281, well off the recent record peak just under $1.3670.

* Spot silver rises to $6.51/6.54 from $6.41/6.45 in New York. Market hovering above three-month lows, with gains seen amid oversold conditions.

* Platinum at $845.00/850.00 from $842.00/846.00 in New York.

* Palladium at $178.00/183.00 against $179.50/185.50.
05 Jan 2005 17:46

05.01.2005 17:26:18 COMEX gold stays soft early on dollar strength

NEW YORK, Jan 5 (Reuters) - U.S. gold futures dipped but held above prior two-month lows on Wednesday morning, under slight pressure from newfound strength in the dollar this week, which limited the metal's demand from overseas traders.

Silver, platinum and palladium steadied in a technical bounce after two days of fund liquidation across the precious and base metals complex, dealers said.

February delivery gold lost 40 cents to $428.80 an ounce by 11:06 a.m. EST (1606 GMT) on the New York Mercantile Exchange's COMEX division, trading $429 to $425.90, and above Tuesday's low at $424.80 -- its cheapest level since Nov. 3.

"The strength of the dollar in the last few days has attracted some liquidation, I would say to book some profits on the carry-over from the end of the year," said Frank Aburto at F.C. Stone.

Even with gold at lower prices and analysts saying the dollar's resurgence was merely temporary, traders were reluctant to beef up their large long positions as the greenback stayed firm, dealers said.

"What you're seeing is a lot of people who put on long commodities trades getting scared out," said a broker at a futures commission merchant.

Gold often fades moves in the dollar as investors use it as an alternative to the U.S. currency.

However, some brokers were surprised to see charts were showing gold leading the euro in terms of losses, which they said ran contrary to the typical pattern of the metal mirroring the common European currency.

The dollar climbed to three-week highs against the euro and the yen Wednesday, building on gains after the minutes of the U.S. Federal Reserve's latest meeting suggested the central bank might step up the pace of interest rate rises.

The dollar was at $1.3290 per euro, up almost 4 cents from last week's all-time low at $1.3667.

On the data front, the Institute for Supply Management's non-manufacturing index rose to a better-than-expected reading of 63.1 in December, above 61.3 a month earlier and Wall Street estimates of 61.0.

F.C. Stone's Aburto pegged support in COMEX February gold at $425, $424.80, then $415, with resistance at $430 and $433-435, provided how the euro behaves.

Spot gold priced at $427.65/8.40 an ounce, up from Tuesday's late New York quote at $427.60/8.30. Wednesday's afternoon London fix was at $426.

Holdings of gold in the U.S. exchange-traded fund streetTRACKS , which is backed by bullion, stood at 109.14 tonnes on Jan. 4, off slightly from a record high 109.16 tonnes the day before.

March silver rose 10.8 cents to $6.56 an ounce, dealing from $6.41 to $6.57, and up from Tuesday session low at $6.35, not seen since Sept. 22.

Spot silver fetched $6.53/56, above its last New York close at $6.41/44. Wednesday's fix was up at $6.455.

NYMEX April platinum gained $3.20 to $847 an ounce. Spot platinum traded up at $845/850.

March palladium rose $2.85 to $183 an ounce. Spot stuck around $180/184.

05 Jan 2005 17:25

05.01.2005 17:10:47 Commodities News Summary

TOP NEWS
> Europe gold eases as dollar holds gains [nL05278780]

LONDON - Gold prices fell on Wednesday in Europe, with the metal's appeal as an alternative investment dulled by the dollar's extended rebound against major rivals, dealers said.

Spot gold eased to $426.30/427.00 per troy ounce by 1546 GMT, from $427.60/428.30 late in New York on Tuesday.

- - - -

> LME zinc up 3.4 pct on short-covering [nL05382378]

LONDON - London Metal Exchange zinc contracts rose more than three percent on Wednesday as investors covered short positions after a major sell-off on Tuesday, traders said.

At 1525 GMT three months zinc was 3.4 percent, or $40, up at $1,210/12.

- - - -

GRAINS/OILSEEDS/LIVESTOCK
> Vietnam fights bird flu threat as boy dies [nHAN169261]

HANOI - Bird flu has killed a 9-year-old boy in Vietnam, a health official said on Wednesday, marking the first reported death in 2005 from a virus that killed more than 30 people last year and ravaged the poultry industry as it swept across Asia.

The death comes a week after the World Health Organisation warned Vietnam may face new bird flu outbreaks this month, as poultry is transported around the country ahead of the Lunar New Year celebrations in early February.

- - - -

> Pakistan eyes record cotton crop at 13.7 mln bales [nISL186198]

ISLAMABAD - Pakistan expects a record 2004/05 cotton harvest of more than 13.72 million bales (375 lbs), exceeding the target of 10.72 million bales, the government said in a statement on Wednesday.

- - - -

> UK cereals progress well in mild weather -analysts [nL05677735]

LONDON - Britain's main cereal crops are making relatively good progress in mild weather, agronomists said on Wednesday.

- - - -

> Rains fail to remove S.Africa drought fears [nL05593584]

JOHANNESBURG - Large parts of South Africa still desperately need rain, despite recent downpours, as the staple maize crop enters a crucial stage, producers said on Wednesday.

- - - -

> Kazakh 2004 grain crop down to 12.4 mn tonnes-agmi [nL05703554]

ASTANA - Kazakhstan's 2004 grain crop dropped to 12.4 million tonnes by clean weight from 14.8 million tonnes in 2003, Agriculture ministry said on Wednesday.

- - - -

METALS > Copper bounces on LME, market still wary of funds [nL05665356]

LONDON - Copper staged a recovery during Wednesday open-outcry trading on the London Metal Exchange (LME), rising just over one percent, although the metals complex remained wary of renewed investment fund sales, traders said.

Benchmark copper , initially under $2,900 a tonne, rallied on option-related buying to settle at $2,944 a tonne at the end of the rings, a $34 or 1.1 percent advance from the $2,911 Tuesday kerb close.

- - - -

> Titan Australia and China's Baiyin in copper pact [nSYD170676]

SYDNEY - Australia's Titan Resources NL. (/TIR.AX) and Baiyin Nonferrous Metals Corp. of China will form a partnership to glean more than 500,000 tonnes of copper from a mountain of low-grade ore in western China, Titan said on Wednesday.

- - - -

SOFT COMMODITIES
> Ivory Coast's southwestern cocoa routes open [nL05682817]

ABIDJAN - Main routes to Ivory Coast's southwestern port of San Pedro were open on Wednesday after militants withdrew plans to barricade the roads to keep out French troops.

- - - -

> Physical sugar-India buys, enquiry from Pakistan [nEUSUG2]

LONDON - Indian millers may have bought several cargoes of raw sugar this week as a jump in domestic prices boosted import margins, while Pakistani buyers made enquiries, traders said on Wednesday.

- - - -

© Reuters 2004

05 Jan 2005 17:24

05.01.2005 17:14:54 Goldkurs konsolidiert nach Vortagesverlusten

Zürich, 05. Jan (Reuters) - Der Goldkurs hat am Mittwoch im europäischen Markt trotz einer anhaltenden Dollar-Erholung nach den Vortagesabgaben konsolidiert. Der Handel hielt sich in engen Spannen.

Händler wollten einen weiteren Abwärtstrend des gelben Metalls bei einem wieder stärkeren Dollar jedoch nicht ausschliessen. "Wenn der Dollar weiterhin fester tendiert, könnte ich mir weitere Verluste bis möglicherweise auf 420 und 417 Dollar vorstellen", so ein Marktteilnehmer. Er gehe jedoch davon aus, dass die jüngsten Gold-Verkäufe etwas übertrieben ausgefallen seien, so dass Gold bei einem neuerlichen Abwärtstrend nicht weit unter die jüngsten Tiefs sinken dürfte.

Gold war am Dienstag um rund sechs Dollar auf 424,75 Dollar abgesackt, nachdem der Kurs schon am Montag um rund acht Dollar nachgegeben hatte.

Zum Handelsschluss stand die Feinunze Gold bei 426,30/427,00 Dollar nach 424,75/425,50 Dollar am Vortag. In London wurde das Edelmetall am Nachmittag bei 426,00 Dollar gefixt und am Vormittag bei 425,50 Dollar. Am Dienstagnachmittag lautete das Fixing auf 427,75 Dollar.

Ein steigender Dollar verteuert das in der US-Devise gehandelte Gold für Investoren aus anderen Währungsräumen, ausserdem rückt der Absicherungsbedarf gegen eine Dollarabwertung durch die Anlage aktuell nicht benötigter Devisen in Gold in den Hintergrund.

Eine Schweizer Grossbank gab den Gold-Kilopreis mit 15.920/16.170 (Vortag 15.817/16.067) sfr an.

ish/pma

05 Jan 2005 14:38

05.01.2005 13:15:53 Europe gold eases quietly as dollar holds gains

LONDON, Jan 5 (Reuters) - Gold prices fell slightly on Wednesday in Europe, with the market driven chiefly by the dollar's extended rebound against major rivals, dealers said.

Spot gold eased to $426.00/426.70 per troy ounce by 1207 GMT, from $427.60/428.30 late in New York on Tuesday.

The market was attempting to consolidate after sharp drops seen earlier this week as the dollar fought back strongly from record lows against the euro, dulling gold's appeal as an alternative asset.

Dealers did not rule out further falls if the dollar strengthened further.

"If the dollar continues to firm, I could imagine further losses with $420 and $417 being potential targets," a European dealer said.

"However, I believe that the most recent selling was a bit exaggerated and I don't expect it to drop much below this," he added.

The dollar hit three-week highs against the euro and yen, building on gains made after minutes of the U.S. Federal Reserve's latest meeting suggested the central bank might step up the pace of interest-rate rises.

The euro was last indicated around $1.3242.

Dealers and analysts said, however, that gold, which rose almost six percent during 2004, was probably poised to resume its overall uptrend of the last three years as the dollar was set to fall further.

"Our FX strategists do not believe the dollar weakness has yet run its course, but see the scope for a short-term dollar rally amid hawkish FOMC minutes and on expectations of strong U.S. payrolls data on Friday, in which case gold is likely to re-test support," Barclays Capital said in a daily report.

Silver edged up slightly as the market consolidated sharp gold-led falls from Monday, with technical charts showing overbought conditions.

Spot silver was last at $6.44/6.47 from $6.41/6.44 previously.

Platinum stood at $841.00/845.00 from $842.00/846.00, while palladium was marginally lower at $179.00/184.00 from $179.50/185.50 in New York on Tuesday.

05 Jan 2005 09:54

05.01.2005 08:21:08 Europe gold edgy at opening, eyes higher dollar

* Spot gold sluggish in Europe at $427.25/428.00 per troy ounce, against $427.60/428.30 quoted late in New York on Tuesday. Market above Tuesday two-month lows, but under pressure still from dollar strength.

* Spot silver at $6.44/6.47, compared with $6.41/6.45 in New York. Above three-month lows on oversold technical signals.

* Platinum at $844.00/849.00 from $842.00/846.00 in New York.

* Palladium at $178.00/183.00 against $179.50/185.50.
05 Jan 2005 09:54

05.01.2005 08:31:49 Tokyo gold meets solid bids, off 3 1/2-mth lows

TOKYO, Jan 5 (Reuters) - Tokyo gold futures mostly fell modestly on Wednesday but closed above three-and-a-half-month lows as bargain-hunters were keen to buy the yellow metal in view of its bullish fundamentals.

Yen-based gold futures on the Tokyo Commodity Exchange (TOCOM) came under strong selling pressure on technical sales prompted by falls in the dollar-based spot price, which was hammered down by the strength of the dollar, traders said.

But TOCOM gold found support as the metal was fundamentally bullish, with investors keen to hold it for safe-haven purposes amid violence in Iraq and with the market still unconvinced about the latest recovery of the dollar.

"Gold fell on pure technical correction. This is what the market needed as we haven't seen major corrections since September," said a senior trader at a Japanese trading company.

"Further downward correction is possible as speculators are trying to push down the spot price, but this would create more chance for bargain-hunters to buy gold."

The benchmark December gold contract on the Tokyo Commodity Exchange (TOCOM) fell as low as 1,428 yen per gram, the lowest since Sept. 17. The contract has fallen more than 5 percent from a 12-year high of 1,505 yen hit a month ago.

But it managed to draw steady bargain-hunting around the low. The key contract closed flat at 1,442 yen.

Other contacts settled down one to six yen.

At 0630 GMT, spot gold was quoted at $427.40/427.90 an ounce, against $427.60/8.30 in New York on Tuesday.

Traders said there was key support at a 100-day moving average of about $425. The level was seen important as it is a 50 percent retracement point between a low of $395 hit in early September and a 16-year high above $455 hit last month.

Speculators were keen to drive it down as major stop-loss sell orders were rumoured placed around the support, they said.

"Downward pressure was strong as speculators wanted to confirm if there were stops actually lined up around $425," the trader said.

Traders said the next key technical level would be a 200-day moving average of around $410.

Many operators were not expecting gold to fall sharply from current levels, however.

"Gold has come down quite a bit in recent sessions but the basic trend remains bullish," said Tadashi Hashimoto, general manager at Nissho Iwai Futures.

"There are plenty of people who want to buy gold on dips, so its downside should be limited."

Key TOCOM platinum rebounded nearly two percent at one point following a sharp loss the previous day as the yen's fall encouraged buyers to cover their positions, traders said.

The benchmark December contract closed up 47 yen per gram at 2,753 yen. It had moved in a range of 2,720 to 2,758 yen.

Platinum had fallen on Tuesday to a near one-month low of 2,703 yen.

Other contracts closed up 42 to 57 yen.

Below are closing prices for TOCOM's most active precious metals contracts, with the day's turnover for each metal.

Closing prices are in yen per gram except for silver, which is in yen per 10 grams:

For open interest details please click

Closing price Turnover (lots)
GOLD 1,442 (flat) 208,769
SILVER 216.8 (down 5.0) 7,243
PLATINUM 2,753 (up 47) 37,876
PALLADIUM 605 (up 13) 749

04 Jan 2005 20:51

04.01.2005 20:27:20 NY gold ends below $430, silver hits 3-mo. low

NEW YORK, Jan 4 (Reuters) - U.S. gold futures fell but settled above a two-month low on Tuesday while silver hit a three-month nadir, on a second day of fund liquidation in precious metals due to a U.S. dollar rally, dealers said.

Prices found buying support at lower levels though, with London and Tokyo players back in the metals markets after New Year's holidays.

February delivery gold ended down 50 cents at $429.20 an ounce on the New York Mercantile Exchange's COMEX division, after moving from $431.30 to $424.80 -- its lowest close since Nov. 3.

Estimated volume was a busy 71,000 contracts but down from Monday's tally of 93,540 lots, when gold fell 2 percent.

"Clearly it is a dollar rally" that hit gold after it had been at high levels at year-end, said Graham Leighton, vice president precious and base metals at Societe Generale.

"We broke the $439 and $432 levels and then, basically, it's been continued liquidation from the funds as we hit technical levels all the way down."

Gold touched a 16-year peak in early December at $458.70 in futures, fueled by investment and safe haven buying amid ongoing violence in Iraq, the weak dollar and high oil prices.

The market often fades moves in the dollar as investors use it as an alternative to the U.S. currency.

Aside from funds lightening up in gold, Leighton said the devastating Asian tsunamis seemed to be bearish for the market, amid less physical demand in the short-term and new selling to finance recovery efforts, which should increase gold supply.

The dollar rose on short covering after a series of record lows against the euro at the end of 2004. It last hit $1.33 per euro, up more than 3 cents from last week's all-time low at $1.3667.

Analysts were unsure if the dollar's rally would hold, however, as the focus turned to the December U.S. jobs report due Friday.

On Tuesday, U.S. factory orders during November rose at the fastest rate in four months, pushing business up 1.2 percent to a seasonally adjusted $377.42 billion, versus forecasts for up 0.8 percent.

November durable goods were revised to up 1.4 percent from 1.6 percent.

In the latest closely watched CFTC Commitments of Traders data, the net fund long position in COMEX gold futures rose to 98,753 lots as of Dec. 28, from 90,253 lots on Dec. 21.

Spot gold was worth $427.60/8.30 an ounce, below Monday's New York close at $428.60/9.30. Tuesday's afternoon London fix was at $427.75.

March silver fell 5.5 cents to end at $6.452 an ounce, after dealing between $6.545 and $6.35, its lowest level since Sept. 22, as gold remained weak.

CFTC data showed the net fund long exposure in COMEX silver rose to 37,706 lots on Dec. 28 from 37,664 a week earlier.

Spot silver priced at $6.41/44, against its last closing quote at $6.47/50. Tuesday's fix was at $6.39.

NYMEX April platinum settled $9.70 lower at $843.80 an ounce. Spot platinum was at $842/846.

March palladium rose $1.15 to $180.15 an ounce. Spot stayed at $179.50/185.50.

04 Jan 2005 17:38

04.01.2005 17:33:30 Gold durch Dollar-Erholung weiter unter Druck

Zürich, 04. Jan (Reuters) - Gold hat nach herben Verlusten zu Wochenbeginn auch am Dienstag in einem allerdings recht dünnen Handel kräftig verloren. Insbesondere der zum Euro deutlich erholte Dollar setzte dem Goldpreis zu. Zusammen mit den Verlusten von rund acht Dollar vom Vortag sei mittlerweile schon wieder ein attraktives Einstiegsniveau erreicht, sagten Händler.

Bis zum europäischen Handelsschluss sackte Gold auf 424,75/425,50 (Vortagabend 430,70/431,40) Dollar je Feinunze ab. Das Londoner Nachmittagsfixing erfolgte bei 427,75 Dollar nach 426,80 Dollar am Vormittag. 2004 war das gelbe Edelmetall mit einem Plus von sechs Prozent das dritte Jahr in Folge gestiegen. Anfang Dezember hatte Gold mit 456,75 Dollar den höchsten Stand seit 16-1/2 Jahren erreicht.

Gold sei nach den jüngsten Fonds-Liquidationen ein wenig überverkauft, sagte ein Marktteilnehmer. Das könnte Investoren, die auf eine Fortsetzung der Gold-Hausse setzen, anlocken. So lange die Unsicherheiten im Zusammenhang mit dem Doppeldefizit der USA, die den Dollar tendenziell belasten, weiter bestehen, dürfte der Aufwärtstrend des gelben Metalls ungebrochen sein, hiess es.

Ein schwacher Dollar macht das in der US-Devise gehandelte Gold für Investoren aus anderen Währungsräumen günstiger.

Eine Schweizer Grossbank gab den Gold-Kilopreis mit 15.817/16.067 (Montagnachmittag 15.714/15.964) sfr an.

pma/par

04 Jan 2005 16:46

04.01.2005 16:33:03 NY gold, silver hit fresh lows early on fund sales

NEW YORK, Jan 4 (Reuters) - U.S. gold futures fell to a two-month low on Tuesday morning, while silver touched three-month lows, on a second day of fund liquidation inspired by a recovery in the dollar, dealers said.

Precious metals may have found some technical support at cheaper prices, however, after gold lost 2 percent and silver 4.8 percent Monday on, as players in London and Tokyo returned to the market after New Year's holidays.

February delivery gold stumbled down $2.90 to $426.80 an ounce by 10:19 a.m. EST (1519 GMT) on the New York Mercantile Exchange's COMEX division, trading from $431.30 to $426.60, its lowest intraday level since Nov. 3.

"Clearly it is a dollar rally" that was hitting gold after it had been at high levels at end-2004, said Graham Leighton, vice president precious and base metals at Societe Generale.

"We broke the $439 and $432 levels and then, basically, it's been continued liquidation from the funds as we hit technical levels all the way down."

COMEX gold shot to a 16-year peak in early December at $458.70, fueled by investment and safe haven buying due to violence in Iraq, a sharply weaker dollar and high oil prices.

Gold often goes in the opposite direction from the dollar as investors use it as a currency alternative. High oil prices can heighten gold's allure as a hedge against inflation.

But aside from the funds lightening gold holdings, Leighton said the devastating Asian tsunamis looked to be bearish for the market, due to a double effect of lower physical demand in the region after the crisis, at least in the short-term, and selling of assets to finance recovery efforts, which would increase gold supply.

Standard Bank said in a report gold was still tracking the euro and with more participants back in the market Tuesday it remained to be seen if more short-term technical selling was in store, with support pegged at $426.

The dollar climbed on apparent trader short covering after a series of record lows against the euro at the end of 2004. It fetched $1.3366 per euro, up 3 cents from last week's all-time low at $1.3667.

Analysts were unsure if the dollar's rally would hold, however, as the focus turned to the December U.S. jobs report due Friday.

On Tuesday, U.S. factory orders during November rose at the fastest rate in four months, pushing business up 1.2 percent to a seasonally adjusted $377.42 billion, versus forecasts for up 0.8 percent.

November durable goods were revised to up 1.4 percent from 1.6 percent.

In the latest closely watched CFTC Commitments of Traders data, the net fund long position in COMEX gold futures rose to 98,753 lots as of Dec. 28, from 90,253 lots on Dec. 21.

Estimated COMEX volume by 10 a.m. was 23,000 contracts.

Spot gold traded to $426.85/7.40 an ounce, below Monday's New York close at $428.60/9.30. Tuesday's afternoon London fix was at $427.75.

March silver fell 4.7 cents to $6.46 an ounce, dealing between $6.545-$6.38, its lowest level since Sept. 22.

CFTC data showed the net fund long stance in COMEX silver rose to 37,706 lots on Dec. 28 from 37,664 a week earlier.

Spot silver hit $6.41/44, compared with its last closing quote at $6.47/50. Tuesday's fix was at $6.39.

NYMEX April platinum fell $9.50 to $844 an ounce. Spot platinum slid to $842/846.

March palladium rose $1.55 to $180.55 an ounce. Spot touched $179.50/185.50.

04 Jan 2005 14:57

04.01.2005 13:27:15 Silver fixes sharply down, Europe gold pressured

* Silver fixed sharply lower at 639.00 cents per ounce from the previous fix last week ahead of year-end holidays in London at 681.50 cents.

* Spot silver weak at $6.35/6.38, last seen three months ago, compared with $6.47/6.50 in New York on Monday. Market following gold prices down, but dealers say metal looking ripe for a bounce on oversold technical signals.

* Silver forward rates on Reuters page indicated at 2.172, 2.155, 2.122 and 1.953 for one, three, six and 12 months respectively.

* Spot gold drops to $426.30/427.00 per troy ounce by 1221 GMT -- near its lowest in two months -- from $428.60/429.30 quoted late in New York on Monday.

* Market slips as dollar rebounds versus euro. Dollar/euro stands around $1.3365, as the U.S. currency comes back from record lows around $1.3670.

* Platinum at $841.00/846.00 from $853.00/857.00 in New York, while palladium lies flat at $179.50/185.50.

04 Jan 2005 14:30

04.01.2005 12:53:21 Gold under pressure in Europe on dollar fightback

LONDON, Jan 4 (Reuters) - Gold prices fell to around their lowest in two months on a dollar revival in Europe on Tuesday, but dealers saw the decline as a possible buying opportunity for investors.

Spot gold was at $426.60/427.30 an ounce by 1130 GMT, compared with $428.60/429.30 late in New York on Monday.

The market has fallen sharply from robust end-2004 levels around $438 as the dollar fought back against the euro and yen, dulling gold's allure as an alternative asset.

Bullion touched $425.70 at one point on Tuesday -- a level last seen on November 5.

"The market is continuing to see fund liquidation, but prices are a little bit oversold now relative to where the euro/dollar is trading," David Holmes, vice-president at RBC Capital Markets, said.

"I think this is a buying opportunity for people who feel that 2005 is going to be a continuation of the 2004 bullish theme," he added.

The dollar crept up from last week's sharp drop to a record low against the euro around $1.3670, which prompted profit-taking in the single currency.

The euro was last quoted around $1.3372, but persisting worries over the ability of the United States to fund its ballooning deficits were expected to put the dollar on the defensive again in the longer term.

Bullion gained almost six percent during 2004 as it extended a bull-run that that has now lasted for three years, and UBS investment Bank analyst John Reade said in a daily report that gold should resume its uptrend.

"There should not be too much downside unless we are in for a period of protracted U.S. dollar strength, which we do not expect," Reade said.

"Thin liquidity is exacerbating the moves in the currency and metals markets and as such it is too soon to get concerned about the decline in gold."

Silver was languishing at its lowest in three months, with the market sliding sharply after the losses in gold.

Spot silver was last at $6.37/6.40 from $6.47/6.50 last quoted in New York on Monday.

Alexander Zumpfe of Dresdner Kleinwort Wasserstein said selling might push prices down to $6.30, although the metal was now looking oversold and ripe for a bounce.

Platinum stood at $841.00/846.00 from $853.00/857.00, while palladium was flat at $179.50/185.50.

04 Jan 2005 10:58

04.01.2005 08:51:48 Asia Gold-Chinese buying seen, but activity still low

By Lewa Pardomuan

SINGAPORE, Jan 4 (Reuters) - Gold purchases have picked up in China ahead of the Lunar New Year but physical trading is lethargic in other parts of Asia with many investors still in a holiday mood, dealers said on Tuesday. Demand for gold, used as investment and adornment, normally rises ahead of the celebration, which falls in early February this year. Lunar New Year is also celebrated in Indonesia, Malaysia and Singapore.

In Singapore, a centre for bullion trading in southeast Asia , gold bars were offered at a premium of 10 U.S. cents an ounce to London spot prices, unchanged from last week. "There's not much activity, simply because not everybody is at their desk. But I think jewellers should start buying gold now to make sure they have the finished products ready at the shops before the celebration," said one dealer in Malaysia.

"I guess premiums will rise to 20 cents with spot prices coming down, and also because of the festive demand. At 10 cents, you are operating at a loss," he added.

Gold steadied in Asia on Tuesday after falling to a two-month low at $426.65 an ounce in New York because of a firmer dollar and a fall in oil prices.

Spot gold was quoted at $427.75/428.50 an ounce by 0721 GMT, versus $428.60/429.30 last quoted in New

York on Monday and a 16-½ year high of $456.75 an ounce hit in
early December.

"There's some buying in China at the moment for the Chinese New Year," said Ellison Chu, a senior manager at Standard Bank London in Hong Kong.

Gold demand in China, one of the world's largest consumers, was expected to have risen to around 314 tonnes in 2004, up 15 percent from 2003 as the country liberalises its bullion market.

But Chu said demand from investors and jewellers was slow in Hong Kong, which suggested that many players had not returned from holiday.

"The sudden (price) drop doesn't bring in any good business. It's too bad. I think many people are not back yet (from holiday)," he added.

Premiums for gold bars were unchanged at around 20 U.S. cents an ounce in Hong Kong, a key bullion trading city in East Asia.

Some dealers said gold's decline would be temporary, with investors likely to to drive the dollar down again due to the massive U.S. current account and budget deficits.

Investors believe the dollar must weaken more to help correct the imbalances.

Dollar weakness has been the dominant factor behind gold's three-year run higher, and some dealers expected the yellow metal to regain $450 later in January.

Dealers said factors supporting gold included lower mining output, violence in Iraq, the prospect of higher demand in main consumers China and India, as well as the dollar's poor outlook.