* Bullion investors take heart from economic jitters
* Gold outperforms metals, commods in H2 as fear lingers
* SPDR gold ETF holdings hit record 1,320.436 T
* Coming up: U.S. June car sales data on Thursday
(Recasts, adds comments, updates prices, changes byline,
dateline, previous LONDON)
By Frank Tang
NEW YORK, June 30 (Reuters) - Gold was slightly higher on
Wednesday, remaining on an upward trend driven by worries about
a double-dip recession.
The metal has outperformed most other commodities for the
second quarter.
Traders cited follow-through buying after the previous
session's gains in a global equity market sell-off, as
investors fretted over a stalling economic recovery and a
widening European debt crisis.
Frank McGhee, head precious metals trader at Chicago-based
Integrated Brokerage Services LLC, said gold was still in a
upward trend and remained well supported by wider economic
concerns.
"The market can be susceptible for a short-term correction,
as gold prices are now trading at a fair distance above most
moving averages," McGhee said.
The precious metal is the best-performing metal and one of
the few bright spots in commodities for the second quarter,
defying a double-digit decline in the S&P 500 stock index amid
investor jitters.
The price of gold rose more than 11 percent in the second
quarter, as safe-haven demand lifted the metal to its best
quarterly performance since the fourth quarter of 2007.
Spot gold <XAU=> was at $1,242.60 an ounce at 2:26 p.m. EDT
(1826 GMT), against $1,238.00 late in New York on Tuesday. U.S.
gold futures for August delivery <GCQ0> settled up $3.50 at
$1245.90 an ounce.
Gold in early trade retreated on a disappointing U.S.
private-sector jobs report and as low demand at the European
Central Bank's latest bank refinancing operations eased some
concerns over euro zone bank finances. []
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. []
Demand for physical gold as an investment vehicle remained
strong, with holdings of the world's largest gold-backed
exchange-traded fund (ETF), New York's SPDR Gold Trust <GLD>,
rising to a record 1,320.436 tonnes on Tuesday. []
"The large gold ETF holdings are reminding traders that
gold is now another currency, and the ADP employment numbers
keep recovery thoughts on the back burner," said George Gero,
vice president of RBC Capital Markets Global Futures.
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 the 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.
For a graphic: http://link.reuters.com/hun72k
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 lackluster 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 at $18.58 an
ounce against $18.46, platinum <XPT=> at $1,534.50 an ounce
versus $1,539.50, and palladium <XPD=> at $443 against $450.
Prices at 2:38 p.m. EDT (1838 GMT)
LAST/ NET PCT YTD
CLOSE CHG CHG CHG
US gold <GCQ0> 1245.90 3.50 0.3% 13.7%
US silver <SIN0> 18.671 0.077 0.0% 10.8%
US platinum <PLN0> 1530.90 -17.20 -1.1% 4.1%
US palladium <PAU0> 444.40 -10.00 -2.2% 8.7%
Gold <XAU=> 1242.25 4.25 0.3% 13.3%
Silver <XAG=> 18.59 0.13 0.7% 10.4%
Platinum <XPT=> 1534.50 -5.00 -0.3% 4.7%
Palladium <XPD=> 443.00 -7.00 -1.6% 9.2%
Gold Fix <XAUFIX=> 1244.00 3.50 0.3% 12.7%
Silver Fix <XAGFIX=> 18.74 17.00 0.9% 10.3%
Platinum Fix <XPTFIX=> 1532.00 1.00 0.1% 4.5%
Palladium Fix <XPDFIX=> 446.00 3.00 0.7% 10.9%
(Additional reporting by Jan Harvey in London; Editing by
Sofina Mirza-Reid)
