* Gold comes under pressure from selling by scrap dealers.
* SPDR Gold Trust holdings hit record
By Risa Maeda
TOKYO, March 17 (Reuters) - Gold fell 0.4 percent on
Tuesday, coming under pressure from selling by scrap dealers to
lock in profits around $920 per ounce, while a rise in regional
stock markets suggested some recovery in risk appetite.
Trade was slow as Japanese institutional investors curbed
activity before the fiscal year-end on March 31 and because the
physical business in mainland China was quiet.
"Sell orders from scrap dealers in the region are now lined
up around $920, down from $940 and $930 previously," said
Kaname Gokon, deputy general manager at Okato Shoji Co in
Tokyo.
"As long as the market maintains the current downtrend,
such selling will not subside, overwhelming speculative
buying," he said, referring to a steady inflow of money into
the world's largest gold-backed exchange-traded fund.
The world's largest gold-backed ETF, the SPDR Gold Trust
<GLD>, said holdings hit a record 1,069.05 tonnes as of March
16, up 12.23 tonnes or 1.2 percent from the previous day.
[]
Spot gold <XAU=> was trading at $918.85 per ounce at 0655
GMT, down 0.4 percent from New York's notional close of $922.55
on Monday.
It earlier fell as low as $916, off a Monday low of $914.70
and 14 percent above a January trough of $801.65.
Gold cleared the psychological barrier of $1,000 last
month, albeit briefly, as worries about the health of the
financial sector and long-term inflation prospects increased
the yellow metal's allure.
Investors awaited fresh clues to set the market's
direction, such as significant stock market moves and data to
clear uncertainty over the global economic outlook, traders
said.
"In the last couple of days the market has been pretty
quiet in Asia ... The trading range is just stuck between $910
and $940," said a precious metals trader based in Hong Kong.
Underlining slow trade in the region, trading volume of
gold futures on the Tokyo Commodity Exchange totalled only
43,219 lots on Monday, down sharply from the daily average of
64,670 lots last month and 72,458 lots in March last year.
The key TOCOM gold futures contract for February delivery
fell 9 yen to 2,925 yen per gram <0#JAU:>.
Asia-Pacifc stock markets outside of Japan <.MIAPJ0000PUS>
rose almost 2 percent on Tuesday after a minor drop on Wall
Street snapped a four-day rising streak amid hopes the U.S.
recession may be bottoming out. []
Federal Reserve Chairman Ben Bernanke said on Sunday the
United States should start recovering from recession next year.
[]
His comments boosted risk appetite, with stocks rising and
gold and the dollar dipping.
Monetary policy meetings are scheduled in Japan and the
United States.
Both the Bank of Japan and the Federal Reserve are expected
to keep interest rates unchanged at two-day policy meetings
ending on Wednesday. [][]
Precious metals prices at 0704 GMT
Metal Last Change Pct chg YTD pct chg
Turnover
Spot Gold 918.20 -4.35 -0.47 10.27
Spot Silver 12.84 -0.05 -0.39 -13.07
Spot Platinum 1055.00 0.00 +0.00 -30.59
Spot Palladium 198.00 1.00 +0.51 -46.20
TOCOM Gold 2929.00 -5.00 -0.17 -4.28
27702
TOCOM Platinum 3360.00 -1.00 -0.03 -37.07
4906
TOCOM Silver 404.80 -4.80 -1.17 -25.18
313
TOCOM Palladium 637.00 13.00 +2.08 -52.85
193
Euro/Dollar 1.2974
Dollar/Yen 98.79
TOCOM prices in yen per gram, except TOCOM silver which is
priced in yen per 10 grams. Spot prices in $ per ounce.
(Additional reporting by Chikako Mogi; Editing by Lincoln
Feast)
