Gold remains steady in Asian trade

March 03, 2009

Commodity Online
SINGAPORE : Gold prices remained steady in Asian trade Tuesday as trading activities slowed down as the market is waiting for more directions from the equity markets.

Spot gold was trading at $924.00 per ounce at 10.00 a.m Singapore time, down 0.2% from New York's notional close of $925.35 on Monday.

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It earlier fell as low as $921.00, an almost three-week low and down more than 8% from an 11-month high of $1005.40 marked on February 20.

Risk-averse investors had rushed to buy bullion over the past few weeks, pushing it above the psychologically important $US1000 level on February 20, but heavy losses in equity markets on concerns over the global financial sector on Monday triggered a wave of selling to cash in the alternative asset.

The world's largest gold-backed exchange-traded fund, the SPDR Gold Trust, said holdings remained at a record 1029.29 tones on March 2, unchanged from February 26 when it first hit that level.

US stocks slid more than 4% to 12-year lows on Monday as embattled insurer AIG posted a record $61.7 billion loss, the biggest in US corporate history, and received another government bailout.

While more sell-offs in stocks could send gold to or below $900 per ounce, waning demand from bullion-backed exchange-traded funds is another factor casting a shadow over the gold market, analysts said.

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