(Updates prices to afternoon)
By Lewa Pardomuan
SINGAPORE, May 6 (Reuters) - Gold extended gains on
Tuesday, adding to a rise of nearly 2 percent in New York,
helped by bargain hunting and record-high crude oil, which
enhanced the metal's appeal as a hedge against inflation.
Bullion's fall to a four-month low last week also spurred
buying from the physical sector, especially in main consumer
India ahead of a religious festival. But gold was still trading
well below a record of $1,030.80 an ounce hit on March 17.
Gold <XAU=> edged up to $875.30/874.70 an ounce from
$871.15/872.55 late in New York on Monday, moving some way
above Friday's four-month low of $845 an ounce.
Gold's gains offered support to silver, platinum and
palladium.
"Physical demand could provide necessary support and evade
a major sell-off at least until the middle of the week,
considering the expected buying spree from Indian physical
markets," said Pradeep Unni, an analyst at Vision Commodities
Services in Dubai.
"The current week is quite critical for gold and may serve
as the trendsetter for the weeks ahead," said Unni, who pegged
resistance level at $888.
India celebrates on Wednesday and Thursday Akshaya Tritiya,
a festival when many Hindus buy precious metals with the belief
it will give them lasting prosperity.
Dealers also reported buying interest from jewellers and
bargain hunters in the Middle East, Indonesia and Thailand.
Crude oil <CLc1> was steady on Tuesday, having risen more
than $4 to a record above $120 a barrel on a weaker U.S.
dollar, geopolitical tensions and supply concerns.
[]
Gold futures for June delivery <GCM8> on the COMEX division
of the New York Mercantile Exchange added $2.7 an ounce to
$876.6 an ounce.
Tokyo precious metal markets were closed for a holiday.
"There's a combination of physical buying and
short-covering at the lows, but I think the market will still
be in a range of $850 to $880 for the time being," said a
dealer in Hong Kong.
"Holdings on the ETF seem to be dropping a lot, so I don't
know what people really think about the market right now," he
said.
Gold bars were quoted at a premium of 30 cents an ounce to
the spot London prices in Hong Kong, steady from last week
<GOLD/ASIA1>.
Gold held in StreetTRACKS Gold Shares, the world's largest
gold-backed exchange-traded fund <XAUEXT-NYS-TT>, was unchanged
at 580.45 tonnes but down from a record of 663.83 tonnes in
mid-March.
Spot platinum <XPT=> rose to $1,920/1,930 an ounce, from
$1,914.50/1,934.40 late in New York but was still well below a
record of $2,290 an ounce on March 4.
Silver <XAG=> rose to $16.77/16.84 an ounce from
$16.64/16.70 an ounce. The metal struck a 27-year high of
$21.24 on March 17.
Spot palladium <XPD=> rose to $419/424 an ounce from
$416.50/424.50 an ounce but remained below a 6-1/2-year high of
$590 hit on March 4.
Precious metals prices at 0358 GMT
Metal Last Change Pct chg YTD pct chg
Turnover
Spot Gold 874.70 1.65 +0.19 5.04
Spot Silver 16.82 0.14 +0.84 13.88
Spot Platinum 1920.00 5.00 +0.26 26.32
Spot Palladium 418.00 1.00 +0.24 13.59
Euro/Dollar 1.5521
Dollar/Yen 104.76
TOCOM prices in yen per gram, except TOCOM silver which is
priced in yen per 10 grams. Spot prices in $ per ounce.
(Editing by Ben Tan)
