* Gold falls for first day in three, safe-haven allure
dimmed
* Nikkei average down over 11 percent after Wall St's dive
* Oil falls more than 3 pct to fresh 13-month low
(Updates prices, adds quotes)
By Lewa Pardomuan
SINGAPORE, Oct 16 (Reuters) - Gold fell 2 percent on
Thursday, ending a two-day rally as a renewed dive in share
markets forced bullion selling and a deeper slump in oil prices
reduced its appeal as an inflation hedge.
Gold, often viewed as a safe haven in turbulent times,
defied Wednesday's broad commodities and stock market sell-off,
but was swept up in fresh losses on Thursday as Japan's Nikkei
tumbled 11 percent, copper slumped 7 percent and oil shed more
than $2.
"Every commodity is falling. I think it's much better to
keep more cash on hand. The market is so uncertain," said
Ronald Leung, director of Lee Cheong Gold Dealers in Hong Kong.
Gold <XAU=> traded at $832.50 an ounce, down $15.50 from
New York's notional close on Wednesday, when it gained 1
percent amid losses in stock markets.
"In the past, we would expect to see gold move up when
stock markets tumbled, but this is not the case anymore. People
think some of the financial institutions have to liquidate
their long positions to cover losses," a dealer in Hong Kong
said.
"Some of the funds are not doing very well. Technically,
it's difficult to say where the market is heading but $850 and
$860 are still good resistance levels," he said.
Platinum fell 4 percent to its lowest in 3 years on fears
of falling demand for autocalysts after J.D. Power and
Associates pegged October sales on track for a 17-year low with
a sales rate below 12 million units. []
Darren Heathcote of Investec Austarlia in Sydney also said
traders were probably selling gold to meet margin calls, but
reckoned another wave of buying was possible if markets calmed.
"But one could expect that if the market calms again in the
next couple of days, we might get a slight push up again," said
Heathcote, who pegged resistance at $900 -- a level last seen
earlier this month.
Gold's volatility has spooked jewellers and some investors.
It hit a two-month high of $931 on Friday on a weak dollar
before tumbling all the way to $823.50 on the same day as
investors sought cash to cover margin calls.
Gold was well below a record of $1,030.80 hit in March,
when investors and funds poured money into the metal on fears
of rising energy costs and uncertainties in the dollar's
outlook.
Shares across the world plunged on Thursday as investors
came to grips with the fact that a sharp global slowdown had
swiftly replaced bank collapses as their biggest fear.
[] The MSCI World stock index <.MIWD00000PUS> fell 3.8
percent.
Oil <CLc1> fell for a third day to a new 13-month low near
$73 a barrel on Thursday on worries that a deepening economic
slowdown will cut into already weakening demand. []
Platinum <XPT=> plunged for a second day, falling $42.00 an
ounce to $913.00, a three-year low amid fears that a global
recession would do even more damage to new car sales, reducing
demand for the metal for use in autocalysts to clean exhaust
fumes.
Precious metals prices at 0744 GMT
Metal Last Change Pct chg YTD pct chg
Turnover
Spot Gold 832.50 -15.50 -1.83 -0.02
Spot Silver 9.77 -0.46 -4.50 -33.85
Spot Platinum 913.00 -42.00 -4.40 -39.93
Spot Palladium 190.00 1.00 +0.53 -48.37
TOCOM Gold 2682.00 -76.00 -2.76 -12.35
47141
TOCOM Platinum 2950.00 -300.00 -9.23 -44.75
19548
TOCOM Silver 314.40 -40.00 -11.29 -41.89
1531
TOCOM Palladium 619.00 -50.00 -7.47 -54.18
667
Euro/Dollar 1.3415
Dollar/Yen 100.55
TOCOM prices in yen per gram, except TOCOM silver which is
priced in yen per 10 grams. Spot prices in $ per ounce.
(Editing by Clarence Fernandez)
