* Equities slip prompts liquidation in gold
* Oil, base metals slide after Monday bounce
* Dollar firms as US stocks dive 3 percent
(Recasts, updates with quotes, closing prices, market
activity, adds NEW YORK to dateline)
By Frank Tang and Jan Harvey
NEW YORK/LONDON, Nov 11 (Reuters) - Gold ended sharply
lower on Tuesday amid broad commodity weakness triggered by a
higher dollar and a tumbling stock market, but a deepening
financial crisis should support bullion in the long term.
"Gold may likely retest its recent lows," said Axel Merk,
portfolio manager of the Merk Hard and Asian Currency Funds.
"But the fact that American Express converts to a banking
charter scares many people. We do have many problems out there.
Not surprisingly, gold is holding up very well in this
environment," Merk said.
American Express Co <AXP.N> said it won approval to become
a bank holding company, which could cut its borrowing costs and
give it more access to government money. []
Spot gold <XAU=> was quoted at $734.25 at 3:05 p.m. EST
(2005 GMT), down 1.6 percent from Monday's close of $745.80.
Silver <XAG=> ended lower at $9.73, down 4 percent from
Monday's close of $10.13.
Bullion hit a low of $680.80 on Oct. 24, the weakest level
since September 2007.
U.S. December gold futures <GCZ8> settled down $13.70, or
1.8 percent, at $732.80 an ounce on the COMEX division of the
New York Mercantile Exchange.
A recovery in faltering oil and industrial metals prices on
Monday had helped lift precious metals, but the recovery was
short-lived as fears over the global economy resurfaced.
Oil and industrial metals prices slipped on Tuesday, with
U.S. crude futures falling below $59 a barrel amid a slide in
global stock markets. []
The broad-based Reuters/Jefferies CRB <.CRB> commodity
index dropped 3.5 percent.
Wall Street fell as optimism sparked by near-$600 billion
stimulus package announced by China on Monday evaporated. Its
losses are pressuring all commodities, including gold. []
"Gold is not living up to its reputation as a safe haven at
present, and to a lesser extent is behaving like any other
commodity," said Commerzbank in a note.
The dollar benefited from safe-haven buying amid weak
equity prices. [] Gold is often bought as an alternative to
the dollar and tends to move in the opposite direction to it.
Prices should consolidate in the short term, analysts said,
with the market eyeing this weekend's G20 summit in Washington,
where world leaders will discuss the financial crisis.
PLATINUM TUMBLES
Platinum prices slipped more than 4 percent after climbing
on Monday as traders hoped the Chinese stimulus package could
lead to a recovery in demand for industrial precious metals.
Platinum and palladium prices have slumped in recent months
as traders fretted over the outlook for demand from carmakers,
who consume around half of the world's platinum group metals.
Spot platinum <XPT=> fetched $813.50, down 4 percent from
Monday's finish. Palladium <XPD=> traded at $212, down 2.5
percent from its previous close.
Stillwater Mining said on Monday it was looking to adjust
its operations to conserve cash due to falling metals prices.
