* Gold slips from 11-week high as investors book profits
* Oil falls below $40 a barrel despite Mideast violence
* Dollar slips against euro
(Updates prices)
By Lewa Pardomuan
SINGAPORE, Dec 30 (Reuters) - Gold slipped on Tuesday as
speculators booked profits from a rally to an 11-week high the
previous day, but sentiment was still underpinned by conflict
in the Middle East and a weaker U.S. dollar.
Gold rallied as much as 24 percent in 2008, striking a
record high of $1,030.80 in March on fears of rising energy
costs and as investors diversified into precious metals on the
dollar's uncertain outlook.
"There's a reasonable chance we'll see some end-year profit
taking in what has been the best performing commodity this year
and certainly this quarter," said Mark Pervan, head of
Australia & New Zealand Bank research.
"There's been concerns of high political risk in the
market. But I think it might struggle to get through $900,
unless there's a major flare up again tonight," he said,
referring to the fighting between Israel and Hamas in Gaza.
Gold <XAU=> was trading at $873.75 an ounce, down $3.75 an
ounce from New York's notional close on Monday, when it rallied
to as high as $889.55 an ounce after oil jumped more than $2 on
fears Israeli attacks on Hamas could disrupt oil supplies.
Buying from Japanese investors amid fears of a global
recession helped gold stay at current levels, dealers said.
Gold last traded above $900 in early October, before tumbling
to its weakest in 13 months around $680 after a sell-off in
equities and fears of a deepening global economic downturn
forced investors to cash in to cover losses.
It slowly regained its safe-haven appeal after stock
markets stabilised, with a rebound to around $800 also igniting
technical buying.
Israeli warplanes killed 10 Palestinians in attacks that
targeted Hamas government buildings and other symbols of the
Islamist group on the fourth day of the fiercest air offensive
in Gaza in four decades. []
Oil fell below $40 on Tuesday as demand concerns
overshadowed Middle East crude supply fears amid the
Israeli-Hamas conflict, with prices on track to end the year
down 60 percent, their biggest annual loss on record. []
"Although gold has the energy to head higher,
sustainability would be a key factor," said Pradeep Unni at
Richcom Global Services in Dubai, adding that gold had in the
past failed to hold on to gains driven by geopolitical
tensions.
He pegged resistance around $930 an ounce, a near
three-month high hit in early October.
The euro rose to $1.4062 <EUR=> as tensions in the Middle
East weighed on the U.S. currency. []
Investors are awaiting the release of U.S. consumer
confidence for December, due at 1500 GMT. Economists polled by
Reuters expect a reading of 45.0 compared with 44.9 in
November.
Platinum <XPT=> was trading at $902.00 an ounce, down
$13.50 from New York notional close.
New York gold futures <GCZ9> added $0.7 an ounce to $876.0
in electronic trade.
Precious metals prices at 0617 GMT
Metal Last Change Pct chg YTD pct chg
Turnover
Spot Gold 873.75 -3.75 -0.43 4.93
Spot Silver 10.81 -0.04 -0.37 -26.81
Spot Platinum 902.00 -13.50 -1.47 -40.66
Spot Palladium 182.00 -3.50 -1.89 -50.54
TOCOM Gold 2573.00 -7.00 -0.27 -15.92
15541
TOCOM Platinum 2652.00 -7.00 -0.26 -50.33
4585
TOCOM Silver 319.30 6.00 +1.92 -40.98
325
TOCOM Palladium 550.00 16.00 +3.00 -59.29
254
Euro/Dollar 1.4044
Dollar/Yen 90.27
TOCOM prices in yen per gram, except TOCOM silver which is
priced in yen per 10 grams. Spot prices in $ per ounce.
(Editing by Clarence Fernandez)
