* Rise in gold trust holdings lends some support
* Stocks rise, euro holds onto gains
* Coming Up: U.S. personal income April; 1230 GMT
(Updates throughout, previous SYDNEY)
By Humeyra Pamuk
LONDON, May 28 (Reuters) - Gold rose on Friday, but the
return of risk appetite in global markets curbed its safe-haven
appeal, while boosting palladium to its highest in over a week.
Fears of a crisis in the eurozone that could derail the
region's already-fragile economic recovery sparked a sell-off
across other commodities earlier this week, as investors dumped
riskier asset in search for safety.
On Friday world equities rose for the third straight day as
investors scooped up beaten-down stocks and the euro held on to
the previous session's hefty gains against the dollar. []
[]
Spot gold <XAU=> was quoted at $1,214.45 an ounce at 1021
GMT versus $1,211.10 an ounce late in New York on Thursday. The
safe-haven rally had driven it to a record high of $1,248.95 an
ounce two weeks ago.
"The stability in the eurozone is a hold pattern for gold,"
said Rory McVeigh, trader at Commerzbank.
"The flight to gold has stopped, but people are still
holding it, they haven't gotten out. They're going to hold it to
wait and see where the price action with euro goes," he said.
Gold also found modest fundamental support from a rise in
holdings of the world's largest gold-backed exchange-traded
fund, the SPDR Gold Trust <GLD>, to a new record, showing global
appetite for less risky investments continues on lingering euro
zone debt fears and tensions between South and North Korea.
Benchmark U.S. gold futures for June delivery <GCM0> on the
COMEX division of the New York Mercantile Exchange was up $0.60
at $1,212.50 an ounce.
TENSION SWITCHING AWAY
Bullion traders will closely monitor currency markets, which
will seek direction from macroeconomic data from the U.S, where
personal spending data for April <USGPC=ECI> is due at 1230 GMT.
"Gold has done its bit and now it's a bit struggling to gain
traction," said Nick Moore, global head of metals strategy at
RBS. "The tensions are switching away from safe-haven and I
think that leaves gold somewhat exposed in the near term."
"The focus more perhaps is on the white metals; platinum and
palladium rather than gold," Moore said, referring to platinum
group metals (PGM) which have seen a volatile trade since the
start of the year. []
Spot platinum <XPT=> was at $1,560.50 an ounce after rising
to $1,569 an ounce, its highest since May 20 and versus $1,561
an ounce late in New York on Thursday while spot palladium
<XPD=> was at $465 an ounce versus Thursday's $462 an ounce.
It earlier hit $467.03 an ounce, its highest since May 19.
Carmakers account for around half of annual demand for the
metals for use in autocatalysts. Strength in Chinese car sales
and a recovery in U.S. automotive demand early this year have
especially benefited palladium. []
The news on the increase in the amount of metal allowed on
the platinum and palladium ETFs had also given a boost to the
metals, McVeigh said.
Silver <XAG=> was at $18.55 an ounce versus $18.45 an ounce.
(Additional reporting by Jim Regan in Sydney; editing by James
Jukwey)
