* Equities, euro slip after weak U.S. ADP jobs data
* Gold set to outperform other metals in H2 as fear persists
* SPDR gold ETF holdings hit record 1,320.436 T
(Updates prices, adds comment)
By Jan Harvey
LONDON, June 30 (Reuters) - Gold slipped lower in Europe on
Wednesday, caught up in selling of stocks and other commodities
after a report showed U.S. private sector employers added fewer
jobs than expected in June.
The precious metal is still set to be the best-performing
metal of the second quarter, however, as fears over the global
growth outlook and the stability of the banking system fuel
haven demand for the metal.
Spot gold <XAU=> was bid at $1,236.82 an ounce at 1322 GMT,
against $1,238.00 late in New York on Tuesday. U.S. gold futures
for August delivery <GCQ0> eased $4.50 an ounce to $1,237.90.
The metal earlier rose as high as $1,245.45 an ounce, but
retreated after relatively low demand at the European Central
Bank's latest bank refinancing operations eased some concerns
over euro zone bank finances.
"The better news about European banks has given a little
breathing space," said Societe Generale analyst David Wilson.
"(We are) waiting to see the U.S. ISM numbers to see what
direction we go from here."
European stocks gave up their early gains to turn negative
after the ADP jobs report, while U.S. stock futures retreated
from highs. The euro also pared gains after the data, which
dented interest in currencies seen as higher risk. [] []
Data showed U.S. private employers added 13,000 jobs in
June, compared with a revised gain of 57,000 in May, while
economists polled by Reuters expected a gain of 60,000 jobs.
The ADP jobs report is seen as an important precursor to
Friday's key non-farm payrolls data, a closely watched barometer
of the U.S. economic recovery.
"It doesn't look good for Friday," said Kurt Karl, chief
U.S. economist for Swiss Re in New York. "Right now the current
consensus looks a bit optimistic. Nothing is looking really
upbeat on the economy and the labour market."
GOLD OUTPERFORMS IN H2
Among other commodities, oil and base metals both gave up
early gains to fall after the jobs data, and remain under
pressure from concerns over economic recovery. [] []
Most commodities are heading for a weak end to the first
half, with many on course for their first quarterly loss in 18
months, under pressure from a toxic mix of risk aversion, equity
losses and debt worries. []
In this environment, gold tended to outperform. It has risen
the most among metals in percentage terms in the second quarter.
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For a graphic showing the relative performance of different
commodities so far this year, click on:
http://graphics.thomsonreuters.com/10/CMD_PRFG0510.html
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Demand for physical gold as an investment vehicle remained
strong, with holdings of the world's largest gold-backed
exchange-traded fund, New York's SPDR Gold Trust <GLD>, rising
to a record 1,320.436 tonnes on Tuesday. []
In Hong Kong, premiums for gold bars, a key indicator of
demand, rose. Meanwhile dealers reported scrap sales in India,
the world's biggest gold market, were lacklustre despite high
prices as potential sellers bet on further gains. []
"Selling (of scrap) is at zero. For the last one week it has
been like this because people are waiting for prices to hit
20,000 rupees ($429) per 10 grams," said Jitendra Kantilal,
partner at Jugraj Kantilal & Co, a scrap buyer in Mumbai.
Among other precious metals, silver <XAG=> was bid at $18.47
an ounce against $18.46, platinum <XPT=> at $1,523.20 an ounce
versus $1,539.50, and palladium <XPD=> at $440 against $450.
(Editing by James Jukwey)
