gold

Gold was slightly higher in Asia Monday despite some
pressure in early trading amid a broad selloff in regional stocks and
commodities after Standard & Poor's downgraded nine European sovereigns Friday.
With the euro falling to a fresh 11-year low against the Japanese yen and
loosing ground to the dollar, some of the concerns could linger in the near
term, traders said.
But with strong physical demand in the run up to the Lunar New Year holidays
next week and some safe-haven buying, the metal has moved back to positive
territory, traders said.
However, investors remained cautious ahead of discussions on a new bailout
deal for Greece scheduled this week, as the Greek government scrambles to avoid
a default. "With the (Greek) debt deal yet to be resolved, the euro is looking
weak," a Hong Kong-based trader said, adding that investors appeared mostly
cautious.
At 0555 GMT, spot gold was at $1,640 a troy ounce, up $1.40 from its previous
close.
Analysts have been suggesting gold's safe-haven appeal appeared to have
returned after tracking the euro since late last year.
A Singapore-based analyst said jitters over the euro-zone debt crisis are
reinforcing gold's status as a safe store of value. "Gold will always be a
safe-haven... You'll get some people unwinding from time to time, but there
will always be that counter-trade," he said.
Strong Chinese appetite for gold before the Lunar New Year is also helping
gold, the analyst said. "We expect Chinese demand for gold in 2012 to exceed
800 tons," said Phillip Futures in a note. Rising incomes and cultural affinity
for gold "presents a favorable backdrop for Chinese gold demand to continue
rising," it said.
In the case of silver, the metal's closing above $29.53/oz Friday was the
first time in consecutive weeks since October, ScotiaMocatta said in a note. It
noted that $30.71/oz remained as the technical resistance level with a view
that below this, the grey metal could test $26.10/oz, the 52-week low touched
on September 26.
At 0519 GMT, spot silver was at $29.71/oz, down 6 cents, platinum was at
$1,484/oz, down $3, and palladium was at $634.50/oz, down $2.50.
Platinum gained last week on news that possible power shortages in South
Africa could spark investor interest, said Johnson Matthey in a note. "The
price also benefited from good physical demand in the Far-East and Europe as
well as speculative and technical buying," the house said.
Platinum gained 6.5% last week while palladium was up 4.3%.