* Stocks, commods soar on hopes economic crisis is bottoming
* ECB cuts rates by smaller-than-expected 25 bps
(Releads, adds comment, updates prices)
By Jan Harvey
LONDON, April 2 (Reuters) - Gold fell below $900 an ounce on
Thursday as investors turned to equities, industrial commodities
and other assets on hopes the G20 leaders' summit would result
in more efforts to stimulate the global economy.
Spot gold <XAU=> slid more than 3 percent to a low of
$895.70 an ounce and was quoted at $897.00/899.00 an ounce at
1408 GMT, against $926.40 late in New York on Wednesday.
U.S. gold futures for April delivery <GCJ9> on the COMEX
division of the New York Mercantile Exchange slipped $28.10 to
$898.00 an ounce.
A rise in Wall Street stocks at the open, after a strong
session for equities in Europe, showed some investors were
switching out of gold and back to shares.
"Equity markets have bottomed and I think gold will
therefore suffer from here," said Citigroup analyst David
Thurtell.
U.S. stocks rose sharply at the open on optimism the G20
leaders' meeting underway in London will find a way to temper
the global economic crisis. []
World leaders will impose new financial rules and triple the
war chest of the International Monetary Fund to fight the worst
economic crisis since the 1930s, sources at the G20 summit said.
[]
"The crucial question will be whether markets are satisfied
with what the leaders of the G20 decide on stimulating the
economy," said Peter Fertig, a consultant at Quantitative
Commodity Research in Germany.
"If (investors) get the impression that the worst is over,
that stock markets are going to stabilise further... that would
be a negative factor for gold," he said.
The summit will also discuss the prospect of gold sales by
the International Monetary Fund. The IMF has already said it
intends to sell 403 tonnes of gold, but the decision is awaiting
the approval of the U.S. Congress. []
Analysts said until details of any such sale become clearer,
reaction to the news is likely to be muted. "Given that sales to
date this year under the Central Bank Gold Agreement have been
so low, it can easily accommodate hefty sales," said one.
ECB RATE CUT
On the currency markets, the euro extended gains against the
dollar after the ECB said it is cutting its refinancing rate by
25 basis points to 1.25 percent. []
The ECB will decide on whether to take further non-standard
steps in its monetary policy at its next meeting in May, the
bank's president Jean-Claude Trichet said.
A weaker dollar typically benefits gold, which is often
bought as an alternative asset to the currency. However, the
impact of currencies on the metal are being outweighed by other
factors, such as risk aversion.
The markets are also awaiting key U.S. non-farm payrolls
data on Friday for fresh impetus, traders said.
Among other precious metals, platinum was steady, showing
little reaction to a smaller-than-expected 37 percent drop in
U.S. auto sales in March. []
The metal, which is primarily used as a component in
catalytic converters, shed nearly two-thirds of its value last
year after hitting a record high in March, as the global
slowdown battered the car industry.
Spot platinum <XPT=> was at $1,129/1,139 an ounce from
$1,133.50, while spot palladium <XPD=> was at $216.50/221.50 an
ounce from $218.
Spot silver <XAG=> eased to $12.60/12.67 an ounce from
$13.01, taking its cue from gold.
(Reporting by Jan Harvey; Editing by Peter Blackburn)
