* Gold falls after Dubai shares open sharply lower
* But Dubai crisis sees gold keep safe-haven appeal
* Gold sell-off offers dip-buying chances and supports market
* On track for 12 pct rise in Nov, biggest monthly gain in a yr
By Chikako Mogi
TOKYO, Nov 30 (Reuters) - Gold slipped below $1,175 an ounce
on Monday, even as the dollar extended losses, as Dubai stocks
sank in their first day of trading since the United Arab Emirates
called for a delay in repaying billions of dollars in debt.
Still, fears about a possible default on debt in Dubai helped
keep gold's safe-haven appeal intact and helped limit declines,
traders said.
News that two Dubai flagship firms planned to delay repaying
billions of dollars in debt renewed credit fears and initially
pushed gold down 5 percent on Friday as investors sold off gold
to raise cash to cover losses in equities as well as oil and
other commodities.
One of those firms, Nakheel, said on Monday that it had asked
for three of its listed Islamic bonds worth $5.25 billion to be
suspended from trade until it can inform the market more fully
about its restructuring plans. []
As the dollar's broad rise on its safe-haven aspect fizzled,
gold pared some of the losses, with the sell-off offering buying
opportunities to some investors who had lagged when bullion raced
to record highs almost daily in the past couple of weeks.
"Even when gold succumbs to cashing out, it faces renewed
demand on dips because of its safe-haven appeal against financial
jitters," said Hiroyuki Kikukawa, general manager in the market
research department at Nihon Unicom in Tokyo.
Spot gold <XAU=> was at $1,174.20 an ounce as of 0644 GMT,
down 0.2 percent from New York's notional close of $1,176.70.
It fell as low as $1,163.00 on Monday before paring losses.
Bullion hit a low of $1,136.80 an ounce on Friday, its lowest
since Nov. 20.
While bullion is about 2 percent below its record high of
$1,194.90 hit last week, it is on track for a rise of more than
12 percent in November, which would be its biggest monthly gain
in a year.
U.S. gold futures for December delivery <GCZ9> were at
$1,174.90, compared with $1,174.20 an ounce on the COMEX division
of NYMEX.
The United Arab Emirates' central bank set up an emergency
facility on Sunday to support bank liquidity in the first policy
response to Dubai's debt woes, which threatened to paralyse
lending and derail economic recovery. []
UAE stocks tumbled 6-7 percent on Monday in the first
post-holiday trading after Dubai shocked global markets last week
by seeking a debt standstill for the two firms.
Investors are especially keen to discover whether the
six-month "standstill" on debt repayments involving the firms
will be voluntary. If creditors are not given a choice, the
restructuring will be viewed as a default. []
Asian stock markets made a tentative recovery after last
week's steep sell-off over the Dubai debt crisis as investors'
nerves steadied on hopes that the fallout of a potential default
would be limited.
Wong Eng Soon, an investment analyst at Phillip Futures in
Singapore said gold's fate remained linked to the dollar.
"There is no change in the fundamentals because U.S. interest
(rates) will still be low at least until next year's first half,"
he said.
Nihon Unicom's Kikukawa said gold could be dragged lower if
the euro was sold heavily against the dollar and as financial
institutions prepare to close their books for the year.
"There is a near-term possibility that gold may fall as
speculative positions are unwound, but the market will likely be
underpinned by demand at lower price levels," he said, adding
that gold was likely to find support around $1,100.
Expectations for more central bank buying of bullion in its
reserves also lent support, traders said.
Bullion's rise to a record high was triggered by expectations
that central banks in emerging countries will keep buying bullion
from the International Monetary Fund.
The IMF said it had sold gold to the central banks of Sri
Lanka, India and Mauritius.
Market volatility deterred investment, with holdings at the
world's largest gold-backed exchange-traded fund, SPDR Gold Trust
<GLD>, steady at 1,127.860 tonnes as of Nov. 27.
[]
Other precious metals also bounced from lows hit on Friday.
Silver <XAG=> was at $18.23 an ounce after hitting a two-week
low of $17.66 an ounce on Friday.
Platinum <XPT=> was at $1,449.50 an ounce, above a one-week
low of $1,418.50, and palladium <XPD=> rebounded to $363.50 after
touching a one-week low of $351 on Friday.
Precious metals prices at 0648 GMT
Metal Last Change Pct chg YTD pct chg Turnover
Spot Gold 1173.95 -2.75 -0.23 33.38
Spot Silver 18.23 -0.02 -0.11 61.04
Spot Platinum 1449.00 12.50 +0.87 55.47
Spot Palladium 363.50 1.50 +0.41 97.02
TOCOM Gold 3262.00 6.00 +0.18 26.78 84489
TOCOM Platinum 4020.00 19.00 +0.47 51.58 20153
TOCOM Silver 506.10 4.70 +0.94 58.50 828
TOCOM Palladium 1027.00 16.00 +1.58 86.73 272
Euro/Dollar 1.5064
Dollar/Yen 86.24
TOCOM prices in yen per gram, except TOCOM silver which is
priced in yen per 10 grams. Spot prices in $ per ounce.
(Additional reporting by Miho Yoshikawa)
((chikako.mogi@thomsonreuters.com; +81 3 6441 1871; Reuters
Messaging: chikako.mogi.reuters.com@reuters.net))
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