* Gold down but finds support after dipping near $790
* Asian buyers looking for bargain-hunting opportunities
* Tokyo platinum down 6 pct, spot platinum down 2 pct
(Updates with comments, prices)
By Chikafumi Hodo
TOKYO, Sept 5 (Reuters) - Gold edged down near $790 an
ounce on Friday on the dollar's strength against the euro, as
well as weaker oil prices, but solid purchases by Asian
investors provided support.
Investors were also shaken by sharp falls in equities,
prompting them to shift to dollars while pulling out funds from
risky assets, including precious metals, but Asian bargain
hunters were detected buying gold on dips.
"Gold started lower in Asia, falling near $790, but around
the level we are seeing a big amount of physical gold buying
from Asian players," said Yuichi Ikemizu, managing director at
Standard Bank in Tokyo.
By 0300 GMT, spot gold <XAU=> was at $794.10/795.10 per
ounce, down from $796.15/797.75 late in New York on Thursday.
It dropped as far as $790.35 on Friday.
COMEX gold futures extended losses in Asia after settling
down $5 in New York the previous day. The most active December
contract <GCZ8> was trading at $798.5, down $4.7 or 0.6 percent
from the New York settlement.
Cash gold fell as low as $789.05 on Wednesday, its weakest
in two weeks and near its nine-month low around $773 hit in
mid-August.
Indian buyers, the world's largest consumer, were detected
to have bought in large volumes on price dips ahead of the peak
festive season in October.
Investment bank UBS, one of the largest gold dealers, said
that over the last two weeks, it had seen its strongest
physical sales in 20 years.
But market participants were keen to see if further bargain
hunting would emerge in the physical market.
Gold prices have been put under pressure, slipping about 5
percent over the past week, reflecting the strength of the
dollar and plunges in oil prices.
The dollar rose against the euro <EUR=> after U.S. service
sector data came in stronger than forecast, then extended its
gains after European Central Bank President Jean-Claude Trichet
said the euro zone was in a period of weak economic activity.
Oil prices were little changed near $108 on Friday after
falling nearly 8 percent this week. []
"Investors are extremely careful about taking new risk
positions, including oil and commodities, while funds are
shifting into the dollar," said Tatsuo Kageyama, a market
analyst at Kanetsu Asset Management.
"It could take a while before the market can fully restore
their confidence to shift back their positions into
commodities," Kageyama said.
Tokyo platinum futures <0#JPL:> plunged more than 6 percent
and the cash price <XPT=> fell over 2 percent as lingering
concerns over demand for autocatalysts due to news of poor car
sales in the United States prompted investment funds to sell.
Platinum was under speculative sales amid talk that
carmakers were selling back their platinum holdings to the
market due to poor sales.
U.S. auto sales results announced earlier in the week
showed they fell 15.5 percent to 1.25 million units or to a
seasonally adjusted, annualised rate of 13.72 million units in
August.
This marks the 10th straight month of declining sales in
the U.S. auto market -- the longest such downturn since the
2001 recession.
The benchmark contract for August 2009 delivery <0#JPL:> on
the Tokyo Commodity Exchange fell by the daily 300 yen limit,
or 6.1 percent, to 4,612 yen per gram.
Spot platinum <XPT=> dropped to $1,357.50/1,377.50 an
ounce, down 2.4 percent from $1,391.50/1,411.50 in New York.
Palladium <XPD=> edged down to $280.00/288.00 an ounce from
$281.50/289.50.
Silver <XAG=> fell to $12.70/12.76 an ounce from
$12.74/12.80 late in New York.
Precious metals prices at 0303 GMT
Metal Last Change Pct chg YTD pct chg
Turnover
Spot Gold 795.00 0.45 +0.06 -4.53
Spot Silver 12.70 -0.04 -0.31 -14.01
Spot Platinum 1363.00 -27.00 -1.94 -10.33
Spot Palladium 280.00 -2.00 -0.71 -23.91
TOCOM Gold 2747.00 -111.00 -3.88 -10.23
31369
TOCOM Platinum 4650.00 -262.00 -5.33 -12.91
14124
TOCOM Silver 440.00 -23.10 -4.99 -18.67
512
TOCOM Palladium 978.00 -60.00 -5.78 -27.61
423
Euro/Dollar 1.4268
Dollar/Yen 106.80
TOCOM prices in yen per gram, except for silver which is in
yen per 10 grams, spot prices in $ per ounce.
(Reporting by Chikafumi Hodo; Editing by Edwina Gibbs and
Jacqueline Wong)
