* Gold rises further, holds above $1,200
* For the technicals on gold, click []
* Coming up: ECB rate decision; 1145 GMT
(Updates prices, IMF comments)
By Lewa Pardomuan
SINGAPORE, July 8 (Reuters) - Gold rose to hold above
$1,200 an ounce on Thursday on steady purchases from jewellers
and other physical buyers after a recent drop to a six-week
low, while sentiment was also lifted by gains in equities
markets.
The Nikkei jumped nearly 3 percent after U.S. stocks logged
their best one-day gain in about six weeks on optimism about
the coming earnings season, discouraging speculators from
selling gold to cover losses in other markets. [] []
Gold <XAU=> added $1.80 to $1,203.65 an ounce by 0537 GMT.
It had dropped to its weakest since May 25 at $1,185.05 on
Wednesday, or around 6 percent below a record high above $1,264
struck in late June, before regaining strength.
Traders said gold would have to crack a June level of
around $1,230 to sustain gains, but that a rebound to the
current level had prompted investors to start accumulating long
positions again. Silver, platinum and palladium also bounced
from Wednesday's lows.
"There will also be people who start to see that the
decline of the past few sessions is healthy and allows
technical indicators to unwind from their overbought
conditions," said Ong Yi Ling, investment analyst at Phillip
Futures in Singapore.
"Tough resistance will be that $1,230 level. If it can go
pass that level, it will really signal a return to the bullish
uptrend."
For a graphic of the 24-hour gold technical outlook,
click:
http://graphics.thomsonreuters.com/gfx/WT_20100807094151.jpg
U.S. gold futures for August delivery <GCQ0> rose $5.4 an
ounce to $1,204.3 an ounce.
The physical sector saw buying interest from Indonesia and
Thailand, but consumers were not too aggressive after prices
crossed $1,200 level again.
The world's largest gold-backed exchange-traded fund, SPDR
Gold Trust <GLD.P> said its holdings were unchanged at
1,316.481. The holdings hit a record at 1,320.436 tonnes on
June 29. []
"There's still some buying but I guess most people are now
waiting for delivery. Physical buying is still there and my
premiums have gone up to 80 cents," said a physical dealer in
Singapore, who offered gold bars at 70-cents premium earlier
this week.
Jewelllers in India have been stocking up ahead of
religious festivals, and other physical buyers in Asia snapped
up bullion after prices fell. [] []
India, which accounts for more than 20 percent of global
demand, will celebrate the Hindu festival of Raksha Bandhan on
Aug 24, Janmasthami and Ganesh Chaturthi in September.
[]
A firmer euro also supported gold. The single currency rose
to a two-month high against the dollar on Thursday, with an
upbeat day on Wall Street underpinning improved tolerance for
risk. []
The European Central Bank holds a news conference later in
the day after its monthly meeting, and will face pressure to
say whether Europe-wide stress tests on banks will be tough
enough to convince markets of their worth. []
Gold had hit a lifetime high on worries the European debt
crisis would spread and the U.S. economy was slowing.
The global economy is unlikely to slip back into recession
over the next few years, although such a scenario is not
impossible, the International Monetary Fund's chief economist
Olivier Blanchard said on Thursday [].
Precious metals prices at 0537 GMT
Metal Last Change Pct chg YTD pct chg
Turnover
Spot Gold 1203.65 1.80 +0.15 9.85
Spot Silver 18.05 0.05 +0.28 7.25
Spot Platinum 1528.25 4.75 +0.31 4.18
Spot Palladium 444.25 -1.75 -0.39 9.56
TOCOM Gold 3430.00 86.00 +2.57 5.25
45589
TOCOM Platinum 4367.00 135.00 +3.19 -0.32
16777
TOCOM Silver 51.80 1.50 +2.98 0.19
412
TOCOM Palladium 1273.00 53.00 +4.34 9.27
187
Euro/Dollar 1.2652
Dollar/Yen 88.30
TOCOM prices in yen per gram. Spot prices in $ per ounce.
(Editing by Himani Sarkar)
