*Gold little changed, weaker share markets weigh
*Seen underpinned on global recession-fighting efforts
By Risa Maeda
(Adds comments, updates prices)
TOKYO, Nov 11 (Reuters) - Gold was little changed on Tuesday
after rising 2 percent the previous day on China's economic
stimulus plan, which had eased fears about demand and triggered a
broad-based rally in commodities.
Some analysts said the news about China's $600 billion
stimulus package, together with pledges by the Group of 20
nations to try to avert a global recession, underlined views that
gold would stay underpinned around $700 in the near future.
But investors were reluctant to buy further after the gloomy
outlook for the global economy was underscored by a renewed
sell-off in equities and news on Tuesday that China's annual
consumer price inflation had fallen to a 17-month low.
Spot gold <XAU=> stood at $744.50 an ounce as of 0718 GMT,
compared with the notional close in New York of $745.80 on
Monday.
"The stock markets were hit again by risk aversion, and gold
is now seen as risky," said Tatsuo Kageyama, an analyst at
Kanetsu Asset Management Co in Tokyo.
Selling gold for cash has become quite normal, now that
financial markets around the globe are highly volatile, he added.
Hedge fund managers could sell gold or commodity index funds
including gold to procure cash as the year-end nears, casting
shadow over the yellow metal, he said.
Gold touched a high of $767.80 an ounce in New York on Monday
after the huge government spending package announced by China on
Sunday helped allay risk aversion and fuelled gains in oil, base
metals and commodities across the sector. []
"China is doing its own part... Governments have shared their
needs and will to avert a recession. So, gold will probably stay
somewhat underpinned for a month or two," said Naomi Suzuki, an
analyst at SCM Securities in Tokyo.
She said gold is basically caught in a $700-800 range,
although it may move away from its core range of $730-760 from
time to time.
Tokyo's benchmark Nikkei share average <> fell 3 percent
on Tuesday, while other Asian stock markets followed suit,
tracking Wall Street shares lower as worries about the future of
U.S. companies like General Motors <GM.N> mounted. []
On Monday, Deutsche Bank lowered its equity value on General
Motors <GM.N> to zero, sending its shares to 62-year lows.
[]
The dollar gained ground against the euro, a negative for
gold, which is often considered as an alternative asset to the
dollar.
The European single currency slipped 0.1 percent to $1.2736
<EUR=> after briefly dropping below $1.27 on growing evidence
from the euro zone that its economy has probably already slipped
into a recession.
U.S. gold futures for December delivery <GCZ8> fell 0.3
percent to $744.5 per ounce in Asia on the COMEX division of the
New York Mercantile Exchange.
The benchmark October contract on the Tokyo Commodity
Exchange <0#JAU:> lost 50 yen per gram to 2,347 yen.
Spot platinum <XPT=> fell 1.4 percent to $835.50 an ounce
from $847.00 in New York.
Palladium <XPD=> rose to $218.50 an ounce from $217.50 and
silver <XAG=> was higher at $10.18 from $10.13.
Precious metals prices at 0744 GMT
Metal Last Change Pct chg YTD pct chg Turnover
Spot Gold 744.60 -1.20 -0.16 -10.58
Spot Silver 10.19 0.06 +0.59 -31.01
Spot Platinum 838.50 -8.50 -1.00 -44.84
Spot Palladium 220.50 3.00 +1.38 -40.08
TOCOM Gold 2345.00 -52.00 -2.17 -23.37 41126
TOCOM Platinum 2640.00 -73.00 -2.69 -50.55 15904
TOCOM Silver 320.10 -7.50 -2.29 -40.83 505
TOCOM Palladium 712.00 -13.00 -1.79 -47.30 483
Euro/Dollar 1.2730
Dollar/Yen 97.75
(Additional reporting by Miho Yoshikawa; Editing by Chris
Gallagher)
