* Gold reverses course, rises nearly 1 pct
* Equities, oil, euro slip on concerns over economic outlook
* Platinum underperforms palladium
(Updates throughout with comment, prices)
By Amanda Cooper
LONDON, Aug 24 (Reuters) - Gold rallied by nearly 1 percent
on Tuesday, breaking a two-day losing streak after another round
of negative U.S. data undermined the dollar and whet investor
appetite for perceived safe-haven assets.
Gold prices earlier fell by more than 1 percent as the
dollar rose against the euro and a raft of investor liquidation
weighed on the broader commodities complex.
But a surprisingly weak reading of U.S. existing home sales,
which fell to their lowest in 15 years, pummelled the stock
markets and sent short-term U.S. Treasury yields to record lows.
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Spot gold <XAU=> was at $1,232.20 an ounce at 1520 GMT,
having recovered from an earlier low of $1,210.10, and was up
from $1,223.40 late in New York on Monday. U.S. gold futures for
December delivery <GCZ0> rose $6.8 an ounce to $1,235.60.
"The existing home sales were quite bearish, so you could
potentially see a re-test of the June highs. We're also coming
into a period when physical demand starts playing a bigger
role," said VTB Capital analyst Andrey Kryuchenkov.
"The uptrend is pretty much intact and I think everyone
believes in the bullish case for gold."
Following the home sales data and a drop of over 1 percent
on Wall Street, the dollar reversed course against the euro
<EUR=>, which in turn helped gold recover its losses.
Strength in the dollar typically weighs on gold, curbing its
appeal as an alternative investment and making dollar-priced
assets more expensive for non-U.S. investors. []
SHARES TUMBLE
European shares fell to one-month lows after the home sales
data reinforced existing fears about the outlook for U.S. growth
and crude oil futures <CLc1> slipped by over 1 percent. []
[]
On the bond markets, yields on the benchmark German 10-year
Bund <DE10YT=TWEB> hit record lows, while the Federal Reserve
bought $1.35 billion in Treasuries due from Feb. 2013 to July
2014 in an effort to keep lower long-term interest rates low to
stimulate the economy. [] []
Gold hit a 1-1/2 month high at $1,237.15 an ounce last week
as concerns over the global economic recovery fuelled interest
in the metal as a haven from risk, but has since retreated.
"Last week as we started to see euro zone risk rise, there
was a pick-up in defensive buying out of Europe," said Credit
Suisse analyst Tom Kendall. "But with everything else sliding
lower, and the dollar coming back a bit, it is struggling."
"But I don't think it is going to struggle for too long with
this risk-aversion environment," he added. "Money is going to
continue flowing into longer-dated Treasuries and gold."
Meanwhile, the yen hit a 15-year high against the dollar and
a nine-year peak versus the euro as investors tested the resolve
of Japanese authorities to stem the yen's rise.
Gold priced in Japanese yen <XAUJPY=R> was down about 0.5
percent, having earlier fallen by as much as 2.6 percent 101,394
yen an ounce.
"This week we've seen some liquidation (of gold) come to the
fore on Tocom, with some of the Japanese investors repatriating
cash into yen," Kendall noted.
Silver <XAG=> shot up by more than 2 percent, bid at $18.42
an ounce, versus $17.93 on Monday.
The platinum group metals also recouped earlier losses, with
platinum <XPT=> last at $1,515 an ounce versus $1,504.50 and
palladium <XPD=> at $483 against $481.
Platinum and palladium are chiefly used in autocatalysts,
and have been heavily exposed to the global economic slowdown.
However, palladium has slightly outperformed platinum, as its
potential for demand growth is expected to be stronger.
(Additional reporting by Jan Harvey)
(Editing by Keiron Henderson)
