* Dollar slips further as stocks rise after Chinese data
* Oil, base metals rise as weak dollar boosts hard assets
* Silver hits 5-week high; iShares silver ETF at record
(Updates throughout, changes dateline-pvs TOKYO)
By Jan Harvey
LONDON, Aug 3 (Reuters) - Gold held above $950 an ounce in
Europe on Monday, underpinned by weakness in the dollar, but
fresh gains were capped by a dearth of demand for physical
stocks of the metal from jewellers and exchange-traded funds.
Silver prices climbed to five-week peak, however, as the
largest silver-backed ETF reported a 61-tonne rise in its
holdings of the metal to a new record high.
Spot gold <XAU=> was bid at $954.10 an ounce at 0829 GMT,
against $953.90 an ounce late in New York on Friday. Silver
<XAG=> was at $14.16 an ounce against $13.89, having earlier
touched a high of $14.19.
"Though dollar weakness and recovery in risk appetite could
push (gold) higher, its failure so far to break above a key
resistance point suggests prices have limited upside scope,"
said Pradeep Unni, senior analyst at Richcomm Global Services.
"Lacklustre investment demand and the low physical demand
are adding to the concerns that the summer rally may fail to
hold on to the gains," he added.
Holdings of the largest gold-backed ETF, New York's SPDR
Gold Trust <GLD>, were unchanged for a second straight session
on Friday, having fallen nearly 50 tonnes in July. []
London's ETF Securities meanwhile said holdings of its three
gold-backed exchange traded commodities (ETCs) fell 1.2 percent
last week. ETFs, including ETCs, issue securities backed by
physical commodities, and their buying was a big source of gold
demand in the first quarter. []
Jewellery demand was also lacklustre as Indian consumption
weakened on the back of higher prices. "Traders are waiting for
lower prices," said one dealer. []
But weakness in the dollar, which is boosting demand for
hard assets such as bullion as well as making it cheaper for
holders of other currencies, is firmly underpinning gold prices.
The U.S. currency hovered near its lowest point this year
against a basket of currencies as higher oil prices, rising
global stock markets and positive U.S. economic data diverted
investment into currencies seen as riskier. []
STOCKS CLIMB
World stocks climbed to a new 2009 high on Monday after
signs of a pick-up in Chinese economic activity lifted Asian
shares. European shares also rose after a volatile start to the
day. [] []
Rising equity markets and optimism over Chinese demand for
hard assets boosted interest in oil, with prices rising to a
one-month high. Stronger crude prices generally support interest
in gold as a hedge against oil-led inflation. []
Oil and the dollar also fuelled gains in silver prices, but
the metal took further support from a fresh inflow into the
largest silver-backed ETF, New York's iShares Silver Trust.
Its holdings rose more than 60 tonnes to a record 8,828
tonnes on Friday. []
"We expect silver to continue broadly tracking gold and the
dollar in the coming sessions, with scaled-up resistance
expected around $14.40/14.65," said TheBullionDesk.com analyst
James Moore.
Platinum <XPT=> was at $1,211.50 an ounce against $1,207.50,
while palladium <XPD=> was at $261 against $261.50. Platinum
group metals traders are awaiting U.S. car sales data due later
in the session for direction.
As both platinum and palladium are chiefly used in
autocatalysts, prices have suffered from a downturn in car
demand in the last year.
(Reporting by Jan Harvey; Editing by Anthony Barker)
