* Initial risk aversion helps gold, tracks other commods
* U.S. equities move into positive territory, oil, copper up
* SPDR gold ETF sees fresh outflow as haven appeal wanes
(Recasts, updates prices and comments)
By Jan Harvey
LONDON, July 9 (Reuters) - Gold rose 1.5 percent to above
$1,210 an ounce on Friday, alongside other commodities such as
copper and oil, while underlying cautiousness in the market
continued to boost its safe-haven appeal.
Traders said some short-covering and momentum buying after
bullion broke above the key $1,200 an ounce mark have
accelerated gains, but added that they did not expect further
hefty gains.
Spot gold <XAU=> touched $1,213.35 an ounce, its highest
since July 5 and was bid at $1,211.21 an ounce at 1552 GMT,
against $1,196.48 late in New York on Thursday. U.S. gold
futures for August delivery <GCQ0> firmed $13.10 to $1,209.10.
The metal has recovered after falling to its lowest since
late May on Wednesday at just above $1,185 an ounce.
"It's rising with the rest of the commodities sector,
especially after the prices have broken $1,200 an ounce," said
analyst Eugen Weinberg at Commerzbank.
U.S. crude oil futures extended gains to more than a dollar
while copper rose some 2 percent. [] []
Weinberg said earlier in the European session, bullion got a
boost from risk aversion, when U.S. stock futures pointed to a
flat opening. But later, Wall Street edged higher with earnings
in sight. []
"The overall picture I think still points to cautiousness,
which is positive for gold," said David Wilson, an analyst at
Societe Generale.
On the currency markets, the euro slipped off two-month
highs against the dollar, with investors taking profits ahead of
the weekend as strategists said its recent rally would peter out
due to lingering worries about the euro zone economy. []
ETF HOLDINGS RETREAT
Holdings of the world's largest gold-backed exchange-traded
fund, New York's SPDR Gold Trust <GLD>, slipped again on
Thursday, dipping 0.445 tonnes to 1,316.036 tonnes.
The fund's holdings have retreated 4.4 tonnes from the
record 1,320.436 tonnes they stood at in late June, as the safe
haven-related inflows seen in recent months dried up. []
Elsewhere, lower prices tempted some buyers back to the
market, with jewellers taking advantage of gold's recent price
correction to restock.
"Although we have entered a seasonally weak period for gold
retail demand, wholesale buyers have taken the opportunity
to buy upon dips, although not aggressively," Barclays Capital
said in a note.
"We do expect continued investor interest in gold to drive
prices higher as the year unfolds, however near term long
liquidation given elevated speculative length could cap upward
momentum in the seasonally softer summer months."
Silver <XAG=> prices firmed slightly in line with gold, bid
at $18.14 an ounce against $17.89 late in New York on Thursday.
Holdings of the largest silver-backed ETF, the iShares
Silver Trust <SLV>, have also dropped just over 25 tonnes since
the end of June to 9,151.78 tonnes.
Platinum <XPT=> was at $1,524.50 an ounce against $1,517,
while palladium <XPD=> was at $453.68 against $445.50.
"Buying interest overnight and in Asia has seen platinum
recoup yesterday's weakness, as has palladium," said James
Moore, an analyst at TheBullionDesk.com, in a note.
"Short-term we expect further direction from broader
industrial commodity sentiment while favourable fundamentals
will provide ongoing background support," he added.
(Additional reporting by Humeyra Pamuk; Editing by Anthony
Barker)
