* Gold futures end down $1, fail to break above $1,000/oz
* Broad financial market uncertainty spurs safe-haven bid
* Gold, silver ETFs see inflows, investment demand strong
(Recasts, updates prices, market activity to close; new
byline, dateline, previously LONDON)
By Frank Tang
NEW YORK, Sept 4 (Reuters) - Gold futures ended $1 lower on
Friday as prices failed to surpass $1,000 an ounce, and the
precious metal could be vulnerable to near-term profit taking
after this week's rally, traders said.
U.S. December gold futures <GCZ9> settled down $1 at
$996.70 an ounce on the COMEX division of the New York
Mercantile Exchange. It hit a session peak of $998.40, the
highest price since Feb. 24.
Spot gold <XAU=> at $991.50 an ounce at 2:56 p.m. EDT (1856
GMT), compared with $990.10 late in New York on Thursday.
Prices remained within sight of the $1,030.80 high hit in March
2008.
Gold prices were largely unchanged after the Labor
Department reported the smallest decline in U.S. nonfarm
payrolls in a year in August. Still, the unemployment rate
jumped to a 26-year high of 9.7 percent.
"Gold is holding its own," said Calyon analyst Robin Bhar.
"The data is not bullish or bearish for gold, it is probably
neutral. But we have had a good run, we have gained $40 in
three days, so people are taking some money off the table."
Gold rallied this week amid fears that the stock market
could swoon and inflation could rise with central banks pumping
money into the economy to fight the global recession.
"There are some concerns about the equities market, and
people are very concerned about inflation because of government
spending. It is a highly speculative move with not a lot of
demand," said Bruce Dunn, vice president of trading at New
Jersey-based Auramet Trading.
Bullion benefited from short covering by investors who had
sold call options, technical buying and position squaring ahead
of a U.S. long weekend because of the Labor Day holiday on
Monday, Dunn said.
In addition, traders reported bullion buying related to
closures of energy and other commodities exchange-traded
products (ETNs) amid increased scrutiny by the Commodity
Futures Trading Commission, the U.S. futures market regulator.
Silver also held above $16 an ounce to hit a session high
of $16.32, its firmest level since August 2008, boosted by
gains in gold.
FUNDS PICK UP
Buying of gold exchange-traded funds picked up, with
holdings of the largest, New York's SPDR Gold Trust, posting
the biggest one-day percentage rise since March. []
The No. 1 iShares Silver Trust <SLV.P> also posted an
increase in holdings.
Traders said investors were fleeing to precious metals
because they were losing confidence in a global economic
recovery as Shanghai stocks hit three-month lows this week.
However, Auramet's Dunn said gold prices should eventually
head lower because the rally was short on physical demand.
The price of gold has risen toward the $1,000 an ounce
level several times in the past 18 months, but each rally was
followed by sharp decline.
Among other precious metals, silver <XAG=> was at $16.16 an
ounce against its previous finish of $16.08.
Elsewhere platinum <XPT=> was at $1,247 an ounce against
$1,249.50, while palladium <XPD=> was at $290 against its
previous market close of $289.
Close Change Pct 2008 YTD
Chg Close Pct Chg
US gold <GCZ9> 996.70 -1.00 -0.1 884.30 12.7
US silver <SIZ9> 16.285 -0.005 0.0 11.295 44.2
US platinum <PLV9> 1259.10 5.30 0.4 941.50 33.7
US palladium <PAZ9> 296.00 1.95 0.7 188.70 56.9
Prices at 2:58 p.m. EDT (1858 GMT)
Gold <XAU=> 991.50 1.40 0.1 878.200 12.9
Silver <XAG=> 16.16 0.08 0.5 11.30 43.0
Platinum <XPT=> 1248.50 -1.00 -0.1 924.50 35.0
Palladium <XPD=> 290.00 1.00 0.3 184.50 57.2
Gold Fix <XAUFIX=> 989.00 6.00 0.6 836.50 18.2
Silver Fix <XAGFIX=> 15.950 0.220 1.4 14.760 8.1
Platinum Fix <XPTFIX=> 1250.00 0.00 0.0 1529.00 -18.2
Palladium Fix <XPDFIX=> 290.00 0.00 0.0 365.00 -20.5
(Reporting by Frank Tang in New York and Jan Harvey in London;
Editing by David Gregorio)
