* Gold firms as equities drop, holds near peak
* Coming Up: U.S.mortgage index Weekly; 1100 GMT
(Updates prices, adds quotes)
SINGAPORE, Sept 8 (Reuters) - Gold gained on Wednesday,
within sight of a 2-month high hit the previous day, as global
stocks tumbled and the euro slipped on renewed fears about the
health of the global economy.
Gold could revisit a lifetime high struck in June, with
investors rattled by a Wall Street Journal report that said
"stress tests" published more than a month ago underestimated
some lenders' holdings of potentially risky government debt.
Spot gold <XAU=> added $3.35 to $1,256.45 an ounce by 0144
GMT after rising as high as $1,259.80 on Tuesday, its strongest
since June 28. Gold struck a record high around $1,264 in June.
"There's a possibility that we'll see gold breaching the
$1,260 level," said Ong Yi Ling, an investment analyst at
Phillip Futures in Singapore.
"So I think really we are at the level where any economic
news that comes out that is less than favourable will drive
investors to seek out gold as a safe haven."
U.S. gold futures for December delivery <GCZ0> were barely
changed at $1,258.4 an ounce, having hit a high of $1,261.60 on
Tuesday.
Silver <XAG=>, which normally tracks gold, was steady after
rallying to its highest since March 2008 at $20 an ounce on
Tuesday. Platinum <XPT=> and palladium <XPD=> dropped due to
declines in equities.
Holdings in the world's largest gold-backed exchange-traded
fund, SPDR Gold Trust, were unchanged at 1,294.442 tonnes,
suggesting that investors held on to bullion because of the
economic uncertainty.
"I think on the physical side, I wouldn't be too worried
about it. It will be the investment demand that will drive the
prices higher," said Ong of Phillip Futures.
"I look at it breaching $1,260, possibly coming down a
little bit and building a base above the $1,250 level."
Bargain buying from jewellers kept premiums for gold bars
steady in Asia, while speculators were keen to cash in after a
rebound in bullion prices, dealers said on Tuesday. []
The Nikkei fell 1.4 percent on Wednesday on a rising yen and
after U.S. stocks dropped as renewed concerns about European
banks prompted investors to sell shares after strong gains last
week. [] []
The euro was on the defensive on Wednesday as the latest
scare over the euro zone banking system slapped it to lifetime
lows against the Swiss franc and Australian dollar, while also
boosting the safe-haven yen. []
Precious metals prices at 0144 GMT
Metal Last Change Pct chg YTD pct chg
Turnover
Spot Gold 1256.45 3.35 +0.27 14.67
Spot Silver 19.86 0.03 +0.15 18.00
Spot Platinum 1543.00 -10.03 -0.65 5.18
Spot Palladium 519.50 -1.35 -0.26 28.11
TOCOM Gold 3391.00 5.00 +0.15 4.05
19893
TOCOM Platinum 4192.00 -53.00 -1.25 -4.31
10067
TOCOM Silver 53.70 -0.30 -0.56 3.87
248
TOCOM Palladium 1403.00 -32.00 -2.23 20.43
273
Euro/Dollar 1.2682
Dollar/Yen 83.68
TOCOM prices in yen per gram. Spot prices in $ per ounce.
(Reporting by Lewa Pardomuan; Editing by Manash Goswami)
