July 13, 2016 / 5:05 AM / 2 years ago

PRECIOUS-Gold up slightly after dipping to near 2-week low

* Asian shares near 2016 peak
    * Palladium marks best since Nov. 2015
    * SPDR gold holdings post biggest one-day fall in 2016 on

 (Recasts, updates prices)
    By Vijaykumar Vedala and Sethuraman N R
    BENGALURU, July 13 (Reuters) - Gold rose marginally on
Wednesday, recovering from selling pressure in early trade that
pushed bullion to a near two-week low, with investors using the
opportunity to hunt for bargains even as improved risk appetite
helped global equities rally.
    Asian shares came within reach of testing their 2016 peak on
Wednesday as prospects of solid U.S. growth and accommodative
economic policy in major countries whet investors' risk appetite
damaged by uncertainty from Brexit. 
    In Britain, Theresa May, who will take over as prime
minister on Wednesday, said she plans to set up a new government
department to lead the process of withdrawing the country from
the European Union. 
    Spot gold was up 0.7 percent at $1,341 per ounce by
0650 GMT after touching $1,327.30, its lowest since July 1.
Bullion fell 1.7 percent on Tuesday, its biggest one-day drop
since May 24.
    U.S. gold inched up 0.5 percent to $1,341.60 an
ounce, after falling 1.6 percent in the previous session.
    Whenever there is some short-term pressure, a range of
$1,330 could be a very good entry point for people who have been
bullish, but hesitant of chasing the prices, said Mark To, head
of research at Hong Kong's Wing Fung Financial Group.
    "There was some selling in early trade, which seemed to be a
bit of weak longs that were getting stopped on the break of the
$1,330 level. Since then we have just been grounding back up,"
said a Sydney-based trader, who did not want to be named.
    "In the medium to longer term, the market will be pushed
high, but I would not be surprised if there is further longer
liquidation and maybe a push towards $1,300 in the next few
    Spot gold may drop to $1,308 per ounce, as it has pierced
below a support at $1,334, according to Reuters technical
analyst Wang Tao. 
    Despite better-than-expected U.S. non-farm payrolls data,
the Federal Reserve should be in no rush to raise interest
rates, two senior Fed officials said.  
    Lower rates tend to boost gold prices because they cut the
opportunity cost of holding non-yielding bullion while weighing
on the U.S. dollar, in which it is priced.
    Holdings of SPDR Gold Trust, the world's largest
gold-backed exchange-traded fund, fell 1.63 percent to 965.22
tonnes on Tuesday, its biggest one-day decline since Dec. 2,
    Among other precious metals, palladium touched a more
than 8-month high and was up 2.3 percent at $638.72. 
    Platinum, which fell for the first time in two weeks
in the previous session, rose 0.7 percent to $1,094 an ounce. 
    Silver was up 1.3 percent at $20.38 an ounce.

 (Reporting By Nallur Sethuraman and Vijaykumar Vedala in
Bengaluru; Editing by Joseph Radford and Biju Dwarakanath)
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