* Gold holds near NY levels, off 2-week lows
* Early Chinese buying lifts prices
* Coming Up: Weekly U.S. mortgage market index, 1200 GMT
(Updates prices; adds quotes)
By Lewa Pardomuan
SINGAPORE, March 10 (Reuters) - Gold steadied on Wednesday
after the euro bounced slightly higher against the U.S. dollar
though weaker oil prices could prompt new selling, traders
said.
Dealers noted early bargain hunting from Chinese
speculators but gold prices were susceptible to sharp movements
due to low volumes. Platinum and palladium slipped in early
trade but held near recent highs.
Spot gold <XAU=> was at $1,122.00 an ounce by 0304 GMT,
barely changed from New York's notional close on Tuesday, when
it dropped to $1,108.55 an ounce, its weakest since Feb. 26,
because of a resurgent dollar and falling oil prices.
Gold was around 2 percent below a 6-1/2-week high near
$1,150 hit in early March. Several attempts to revisit a
lifetime high around $1,200 struck in early December were met
by heavy profit taking but steady investor interest could lend
support.
"If you look at it on a week-on-week basis, the SPDR gold
trust holdings of gold are still up. It means that investment
demand is still there and it is supported by retail," said Wong
Eng Soon, an investment analyst at Phillip Futures in
Singapore.
Debt concerns in euro zone countries also boosted gold's
appeal as a hedge against currency fluctuations, said Wong,
adding that the metal could find support at a February low
around $1,080 an ounce.
"With a lack of confidence in the paper currencies, gold
definitely has to be quite well supported." he added.
The world's largest gold-backed exchange-traded fund, SPDR
Gold Trust <GLD>, said its holdings stood at 1,116.120 tonnes
as of March 9, unchanged from the previous business day, but up
from 1,111.556 in early March. []
U.S. gold futures for April delivery <GCJ0> was little
changed at $1,122.6 an ounce.
The euro <EUR=> edged up against the dollar, trading just
above $1.3600. The common currency had come under fresh
pressure after Fitch ratings agency said it still has a
negative outlook on Portugal's credit rating. []
[]
U.S. crude futures extended declines on Wednesday from an
eight-week high after industry data showed a sharp build in
U.S. crude inventories. In theory, weaker oil prices reduce
gold's appeal as a hedge against inflation. []
Platinum <XPT=> held near its highest in more than a month
at $1,607 an ounce hit on Monday, while palladium <XPD=> barely
moved after being hit by a profit taking since rising to a
two-year high at $480 late last week.
"It appears unlikely that the metal can hold above the $500
an ounce mark for any extended period of time; at least not in
the near future, " said precious metals house Heraeus in a
weekly report.
"In the coming days we expect platinum to calm down a bit,
with a trading range in a higher band than that of the past two
weeks. A break above the $1,606 an ounce mark in the next few
trading days seems unlikely," it added.
Platinum and palladium, primarily used in catalysts used in
vehicle exhaust systems, has benefited from well-received
February car sales numbers from China and the United States.
The world's biggest palladium producer, Norilsk Nickel
<GKMN.MM>, also told the Reuters Global Mining and Steel Summit
that the metal is an appealing investment because future
jewellery and industrial demand will be strong.
[]
Precious metals prices at 0304 GMT
Metal Last Change Pct chg YTD pct chg
Turnover
Spot Gold 1122.00 0.85 +0.08 2.40
Spot Silver 17.25 0.02 +0.12 2.50
Spot Platinum 1590.25 1.25 +0.08 8.40
Spot Palladium 464.75 -0.25 -0.05 14.61
TOCOM Gold 3257.00 -1.00 -0.03 -0.06
30959
TOCOM Platinum 4589.00 2.00 +0.04 4.75
12335
TOCOM Silver 50.40 0.10 +0.20 -2.51
456
TOCOM Palladium 1343.00 7.00 +0.52 15.28
498
Euro/Dollar 1.3592
Dollar/Yen 89.96
TOCOM prices in yen per gram. Spot prices in $ per ounce.
(Editing by Ed Lane)
