* Gold up more than $10 after brief Weds dip below $800
* Indian, Mideast physical buyers seen stepping in
* Dollar eases from 8-month high against the euro, oil up
* Platinum rises by more than 2 percent in volatile trade
(Updates throughout, changes dateline, PVS SINGAPORE)
By David Sheppard
LONDON, Sept 4 (Reuters) - Gold rebounded on Thursday,
rising by almost 2 percent to move back above $800 an ounce as
the dollar eased off an 8-month high against the euro.
Bargain hunting and physical buying also boosted prices
after the metal had slipped close to its lowest level in nine
months on Wednesday following a broad-based dollar rally and
weaker oil prices.
Platinum also posted strong gains in volatile trade, with
the metal rising by more than 3 percent on the day as bargain
hunters emerged following a series of heavy losses for the
autocatalyst material.
Gold <XAU=> rose to a high of $814.70 an ounce before easing
slightly to trade at $810.00/811.00 at 1000 GMT from
$800.05/801.65 an ounce late in New York on Wednesday, when it
extended consecutive losses to a fourth day.
"Gold has held up pretty well given the stiff head winds it
has been facing in terms of the dollar's rally of late," said
Standard Chartered analyst Daniel Smith.
"While limited investment demand has pushed prices down
lately, strong physical demand globally is proving supportive,
and with oil rising and the dollar turning towards weakness
today gold has been able to move higher."
Dealers saw purchases from jewellers in Indonesia ahead of
the Eid al-Fitri Muslim holidays in October and safe-haven buying
from Thailand, where Prime Minister Samak Sundaravej refused to
quit as his opponents vowed to keep up a street campaign to
unseat him. []
"We are still seeing physical demand from Thailand and
Indonesia, with prevailing premiums for bars at $1.50 an ounce,"
said a physical dealer in Singapore. "The market is still short
of physical gold at the moment," he said.
Gold fell as low as $789.05 an ounce on Wednesday, near its
nine-month low of $773.90 seen in mid-August, with dollar
strength and the decline in oil prices reducing the metal's
appeal as a hedge against inflation and currency weakness.
Demand from India, the world's largest consumer, and also
the Middle East helped to stem the fall.
"It looks like we are getting some kind of recovery. One
might say around $790 is going to provide support on the
downside. I think we need to break that to see a stronger move
lower," said Darren Heathcote of Investec Australia in Sydney.
India is stepping up purchases during the festive season,
which peaks in October with Diwali, the Hindu festival of
lights.
However, there are concerns that strong demand during August
from key market Turkey may falter due to volatile prices and the
end of the wedding season. []
Later on Wednesday investors will be watching for interest
rate decisions from the Bank of England and the European Central
Bank, which may set the tone for the dollar's next move.
[]
VOLATILE PLATINUM
Platinum pared early losses, which saw the metal slip to a
two week low, to rally by almost 3 percent on the day as bargain
hunters and the dollar's dip eased the metal off its lows.
Spot platinum <XPT=> hit an intraday low of $1,318 an ounce,
down from $1,377.50/1,397.50 late in New York on Wednesday,
before reversing to trade at $1,408.50/$1,428.50 an ounce.
Platinum has fallen by almost 40 percent since touching a
record high of $2,290 an ounce back in March.
Concerns over falling car sales in the U.S. and Europe have
dented sentiment, but some automakers may be looking to buy at
these lower levels, analysts said.
On Wednesday, automakers reported a 10th consecutive month
of U.S. sales declines, with rumours circulating that some
manufacturers were selling back platinum inventories due to poor
car sales.
U.S. auto sales fell 15.5 percent to 1.25 million units or
to a seasonally adjusted, annualised rate of 13.72 million units
in August, marking the 10th straight month of declining sales in
the U.S. auto market -- the longest such downturn since the 2001
recession. []
Autocatalysts, used to clean exhaust fumes, account for more
than half of global platinum use.
Platinum's sister metal palladium rose to $288.50/296.50 an
ounce from 282.50/290.50, while silver tracked gold higher to
trade at $13.09/13.15 an ounce from $12.84/12.97 an ounce.
(Reporting by David Sheppard; Editing by Michael Urquhart)
