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Markets

Gold ticks higher as strong dollar limits gains

Gold edged up in early European trade on Thursday underpinned by it safe-haven appeal due to increasing uncertainty about the health of the global economy, but a stronger dollar was likely to cap gains.

"It's a bit of a tug of war," said one Europe-based trader. "You've got the dollar rising rather sharply and equity markets falling which could cause investors to sell gold too and cover their margins."

"But also economy worries resurfaced again, which is usually beneficial to gold," he added.

Worries about the economy sparked selling for platinum, sending it to its lowest level since July 22. Palladium also tumbled around 4 percent in thin trade.

Platinum and palladium track equities because of their industrial use, mostly in autocatalysts, and dealers said Thursday's drop in prices was a knee-jerk reaction to declines in Asian stocks.

PRICES

* Spot gold was at $1,199.05 an ounce by 0635 GMT, versus $1,197 an ounce last quoted in New York on Wednesday,

* Silver was at $17.57 an ounce versus $17.84 an ounce on Thursday.

* Platinum tumbled nearly 3 percent to around $1,500 an ounce before slightly bouncing to $1,506 an ounce while sister metal palladium was at $460 an ounce from $477 an ounce.

DATA/EVENTS

* U.S. import and export prices for July due at 8:30 a.m. ET.

* U.S. weekly jobless claims due at 8:30 a.m. ET.

* Eurozone industrial production for June due at 5 a.m. ET.

* FRANKFURT - ECB publishes monthly bulletin 4 a.m. ET

MARKET NEWS

* The dollar steadied on Thursday after scoring its biggest daily gain for nearly two years against most major currencies the previous day as concerns about the U.S. and global economies triggered a wave of unwinding in short dollar positions.

* Asian stocks fell for the third straight day on Thursday on rising doubts about global economic growth, while the dollar steadied after scoring its biggest gain in nearly two years as investors cut exposure to riskier assets.

* Oil slid on Thursday for a third straight day on mounting fears that a slowdown in the global economic recovery would cut commodities demand.

* Financial bookmakers expect leading European benchmark indexes to fall on Thursday as they track a plunge on Wall Street on mounting worries over the outlook for the global economy. .N

* U.S. stocks erased the year's gains in the broadest sell off in a month-and-a-half on Wednesday as fears of sustained global economic stagnation caused investors to flee to safer assets. .N

FUNDAMENTALS

* AngloGold Ashanti (ANGJ.J), the world's third-largest and Africa's top gold miner, on Thursday posted better-than-than expected second-quarter earnings and said it expects a rise in third-quarter output.

* The world's largest gold-backed exchange-traded fund, SPDR Gold Trust (GLD.P), said its holdings rose to 1,285.787 tonnes by August 11 from 1,282.746 tonnes on August 5.

* Colombia's gold bonanza has a dark side, U.N. experts said on Tuesday: mercury poisoning spreading from miners to the population of a northwest state where they use mercury to extract the precious metal.

* Global miner Rio Tinto's (RIO.L) (RIO.AX) Zimbabwe unit expects to resume diamond exports in a few days after a government ban on sales in May, the company's managing director said on Wednesday.

TECHNICALS

* Gold support at $1,175 resistance at $1,215, 14-day RSI at 65.3.

* Silver support at $17.38, resistance at $18.29, 14-day RSI at 65.2.

* Platinum support at $1,450, resistance at $1,550, 14-day RSI at 59.1.

(Reporting by Humeyra Pamuk, Editing by Sue Thomas)

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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