PRECIOUS-Gold eases as U.S. equities rally, nonfarm payrolls eyed

Thu Feb 6, 2014 3:01pm EST

* Signs of improving U.S. job market spark S&P gain
    * Euro rallies versus dollar after ECB comments
    * SPDR Gold Trust holdings unchanged after rare inflow
    * Coming up: U.S. nonfarm payrolls Friday

 (Adds comment, second byline, dateline, updates market
activities)
    By Frank Tang and Clara Denina 
    NEW YORK/LONDON, Feb 6 (Reuters) - Gold prices fell slightly
on Thursday as Wall Street rallied, but losses were limited by
the euro's gain versus the dollar and caution ahead of the key
U.S. nonfarm payrolls report on Friday.
    The metal initially rose on a stronger euro after European
Central Bank President Mario Draghi said there is no euro zone
deflation problem, following the bank's decision to leave
interest rates unchanged. 
    Bullion later came under pressure after data showed the
number of Americans filing new claims for unemployment benefits
fell more than expected last week, a sign that the job market
and the broader economy are improving. The S&P
500 equities index rose more than 1 percent. 
    "As the equities market rallied, gold slowly gave back early
gains from dollar weakness. It is not surprising that gold is
lingering around unchanged with the major nonfarm payrolls
report coming out tomorrow," said David Meger, director of
metals trading at Chicago futures brokerage Vision Financial.
    Spot gold was down 30 cents at $1,257.35 an ounce by
2:28 p.m. EST (1928 GMT).
    On Wednesday, gold rose almost 2 percent to a near two-week
high of above $1,270 after a disappointing U.S. ADP
private-sector job report, but it quickly fell back from that
level.
    U.S. COMEX gold futures for April delivery settled up
30 cents at $1,257.20 an ounce. Trading volume was only 85,000
lots, about 55 percent below its 250-day average.    
    Investors are now eyeing the Friday release of U.S. nonfarm
payrolls data, a key gauge of the labor market, as any setback
in economic growth could prompt the Federal Reserve to slow the
pace of its stimulus tapering.
    
    INVESTMENT INTEREST
    Concerns about the fragility of stock markets after a heavy
selloff in recent months has piqued some investors' interest in
gold, with the world's largest bullion-backed exchange-traded
fund, the SPDR Gold Trust, reporting a 3.9-tonne inflow on
Tuesday. But holdings remained unchanged on Wednesday. 
    Platinum was down 0.4 percent at $1,370.82 an ounce.
In South Africa, government-brokered talks between mine union
AMCU and the world's three biggest platinum producers to end a
two week wage strike have been adjourned to allow for individual
consultations.
    Silver edged up 0.3 percent to $19.92 an ounce after
its previous session's 2 percent gain - its biggest one-day jump
in nearly a month. Palladium eased 0.3 percent to $698.60
an ounce. 
 2:28 PM EST     LAST/    NET   PCT      LOW    HIGH  CURRENT
                SETTLE   CHNG  CHNG                       VOL
 US Gold APR   1257.20   0.30   0.0  1252.50 1267.50   81,788
 US Silver MAR  19.928  0.123   0.6   19.830  20.180   34,710
 US Plat APR   1374.90  -4.40  -0.3  1370.30 1385.80    6,086
 US Pall MAR    710.35   3.25   0.5   707.00  715.80    3,169
                                                              
 Gold          1257.35  -0.30   0.0  1253.20 1266.60         
 Silver         19.920  0.050   0.3   19.870  20.160
 Platinum      1370.82  -4.93  -0.4  1372.00 1383.50
 Palladium      698.60  -2.40  -0.3   709.00  714.50
                                                              
 TOTAL MARKET              VOLUME          30-D ATM VOLATILITY
                CURRENT   30D AVG  250D AVG   CURRENT     CHG
 US Gold         84,055   169,969   185,679     17.91   -0.62
 US Silver       44,017    44,505    56,168      26.6    0.27
 US Platinum      6,192    11,000    13,337        19   -0.30
 US Palladium     3,784     4,562     5,569     18.36    0.20
                                                              
 
 (Additional reporting by Jan Harvey in London, A.
Ananthalakshmi in Singapore; Editing by William Hardy and Nick
Zieminski)
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