* Gold tracks stock market lower
* HSBC raises gold view but resistance possible
* S. Africa union plans strike at power utility Eskom
(Recasts, updates prices, market activity to close; new
byline, dateline previously LONDON)
By Frank Tang
NEW YORK, Aug 5 (Reuters) - Gold futures dipped on
Wednesday as weaker equities prompted funds to consolidate
recent profits, but the market drew support from a renewed
appetite for risk among investors.
Platinum and palladium, boosted this week by strong July
car sales, rose on supply worries because of a possible strike
at the power utility in top platinum producer South Africa.
"Recent gains have been helped by increased risk appetite
rather than improvement in fundamental factors. That makes
jumping on any kind of uptrend extremely difficult," said Tom
Pawlicki, precious metals and energy analyst at MF Global in
Chicago.
Renewed interest from investment funds buoyed commodities
and equities alike, as investors focused on economic recovery
rather than deflation which had decreased inflation-hedge
buying in gold earlier this year.
U.S. December gold futures <GCZ9> settled down $3.40 at
$966.30 an ounce on the COMEX division of the New York
Mercantile Exchange.
Spot gold <XAU=> dipped to $966.20 an ounce at 3:30 p.m.
EDT (1930 GMT) from $966.75 an ounce late in New York on
Tuesday.
Precious metals were pressured early as the dollar rose
against the euro after non-manufacturing data showed the U.S.
service sector contracted faster than expected in July,
boosting interest in the U.S. unit as a haven from risk.
"Gold right now is being traded based on what the stock
market and the dollar are doing," said Tom Hartmann, a trader
at Altavest. "It's no surprise that gold's down."
But the dollar reversed gains to hit a seven-month low
against the euro. A weaker U.S. currency encourages investors
to move into hard assets such as bullion and makes commodities
cheaper to other currency holders.
HSBC RAISES GOLD VIEW
Analysts are mostly bullish about gold's outlook, but they
also caution selling pressure could increase as gold prices
near $1,000 an ounce.
HSBC on Wednesday raised its 2009 gold price forecast to
$925 from $875 an ounce on a combination of inflation-hedge
demand, U.S. dollar weakness and stagnant mine output.
However, Steel cautioned that further gains could be capped
by negative market fundamentals.
"Weak jewelry sales and ample scrap supply are freeing gold
for investment, reducing the possibility that gold will sustain
rallies over $1,000 an ounce," Steel said. []
Among other precious metals, silver <XAG=> was at $14.73 an
ounce against $14.61 on Tuesday.
Platinum group metals were lifted on news unions in South
Africa were planning a strike at power utility Eskom
[].
The National Union of Mineworkers, South Africa's biggest
union, said it plans to strike next week after rejecting a wage
offer, raising the threat of power disruptions that could
disrupt metals production. []
Spot platinum <XPT=> hit a high of $1,290 an ounce on
Wednesday, its firmest price since June 6, but later declined
to $1,283.50 an ounce against $1,265.50. Palladium <XPD=> rose
to a new 11-month high of $281, and was at $274.50 against
$274.50.
(Additional reporting by Jan Harvey and Catherine Bosley in
London; Editing by David Gregorio)
Close Change Pct 2008 YTD
Chg Close Pct Chg
US gold <GCZ9> 966.30 -3.40 -0.4 884.30 9.3
US silver <SIU9> 14.760 0.065 0.4 11.295 30.7
US platinum <PLV9> 1293.10 16.30 1.3 941.50 37.3
US palladium <PAU9> 279.20 -1.70 -0.6 188.70 48.0
Prices at 3:32 p.m. EDT (1932 GMT)
Gold <XAU=> 966.15 -0.60 -0.1 878.200 10.0
Silver <XAG=> 14.74 0.13 0.9 11.30 30.4
Platinum <XPT=> 1283.50 18.00 1.4 924.50 38.8
Palladium <XPD=> 274.50 0.00 0.0 184.50 48.8
Gold Fix <XAUFIX=> 960.75 0.25 0.0 836.50 14.9
Silver Fix <XAGFIX=> 14.670 0.590 4.2 14.760 -0.6
Platinum Fix <XPTFIX=> 1286.00 0.00 0.0 1529.00 -15.9
Palladium Fix <XPDFIX=> 280.00 0.00 0.0 365.00 -23.3
