MARKET TALK:

Lack Of Physical Gold Buyers Weighs On Mkt - UBS


The continued absence of physical buyers in the gold
market is "a drag on investor confidence" and may lead to some hesitation at
current prices, says UBS analyst Edel Tully. She says a price below the key
$1,700/oz level would likely encourage physical buyers to return to the market.
"Between the two largest gold markets, China probably has more potential to
accelerate physical purchases towards year-end, as we move ever closer to the
Chinese New Year celebrations," she says. Demand out of India appears to have
been hindered by a weakening rupee. Spot gold down $3.70 at $1,744.20/oz.