* S&P 500 eases after rising to intraday record
* Weak euro against dollar seen weighing on gold
* SPDR Gold Trust holdings down (Adds comment, NEW YORK to dateline, second byline, updates market activities)
By Frank Tang and Clara Denina
NEW YORK/LONDON, Sept 4 (Reuters) - Gold slipped on Thursday as the euro plummeted against the dollar after the European Central Bank cut interest rates to record lows and said it would launch an asset purchase program to ward off deflation.
Early gains in U.S. equities driven by strong U.S. services sector activity also decreased bullion’s safe-haven appeal. The S&P 500 index later turned lower on profit-taking after rising to an intraday record high.
ECB President Mario Draghi, speaking at a news conference shortly after the ECB unexpectedly cut already ultra-low interest rates by another 10 basis points, said the central bank would start purchasing securitized loans and covered bonds next month.
“While an environment of easier global monetary policies tends to be friendly for bullion, gold and the euro have a historical positive correlation,” said James Steel, chief precious metals analyst at HSBC. “Subsequently, further pressure on the euro may weigh on gold.”
A weaker euro against the U.S. currency makes dollar-denominated gold more expensive for European and other non-U.S. investors.
Spot gold fell 0.4 percent to $1,263.66 an ounce by 2:58 p.m. EDT (1858 GMT), having earlier risen as high as $1,276.50.
U.S. COMEX December gold futures settled down $3.80 an ounce at $1,266.50, with trading volume about 20 percent above its 30-day average, preliminary Reuters data showed.
The euro hit fresh 14-month lows against the U.S. dollar and nearly two-year lows against the Swiss franc.
The ECB is under strong pressure to tackle stubbornly low inflation at a time when the conflict in Ukraine threatens to destabilise the region’s fragile recovery.
Gold, seen as an insurance against risk during times of political and financial uncertainties, has gained more than 5 percent so far this year, with tensions in Ukraine and violence in the Middle East.
U.S. nonfarm payrolls data due on Friday is expected to give further clues about the world’s largest economy and the timing of the Federal Reserve’s move to raise interest rates.
Holdings of the SPDR Gold Trust, the world’s largest gold-backed exchange-traded fund and a good measure of investor sentiment, fell 2.69 tonnes to 790.51 tonnes on Wednesday.
Among other precious metals, platinum rose 0.1 percent to $1,403.49 an ounce, and palladium gained 1.6 percent to $885.75 an ounce. The metals, used in auto manufacturing, were lifted as U.S. auto sales reached their highest August level in more than a decade.
Spot silver fell 0.3 percent to $19.08 an ounce.
2:58 PM EDT LAST/ NET PCT LOW HIGH CURRENT
SETTLE CHNG CHNG VOL US Gold DEC 1266.50 -3.80 -0.3 1262.50 1279.20 134,234 US Silver DEC 19.138 -0.051 -0.3 19.055 19.390 37,687 US Plat OCT 1408.30 -4.20 -0.3 1406.00 1417.30 9,694 US Pall DEC 891.00 15.05 1.7 873.15 891.70 4,563 Gold 1263.66 -4.91 -0.4 1262.41 1276.50 Silver 19.080 -0.050 -0.3 19.050 19.350 Platinum 1403.49 1.89 0.1 1405.40 1414.00 Palladium 885.75 14.15 1.6 875.30 889.00 TOTAL MARKET VOLUME 30-D ATM VOLATILITY
CURRENT 30D AVG 250D AVG CURRENT CHG US Gold 146,605 120,377 157,546 13.5 0.06 US Silver 43,656 57,570 53,033 16.8 -0.81 US Platinum 10,907 8,706 11,745 12.76 -0.95 US Palladium 4,581 10,043 6,121 18.4 -0.38 (Additional reporting by A. Ananthalakshmi in Singapore; Editing by David Evans and Nick Zieminski)