* Global stocks higher after U.S. Presidents Day holiday
* European stocks off earlier highs
* Goldman Sachs recommends shorting gold
* GRAPHIC-2016 asset returns: reut.rs/1WAiOSC
* Coming up: January FOMC meeting minutes Wednesday
(Recasts; adds comment, byline, NEW YORK dateline; updates
By Marcy Nicholson and Jan Harvey
NEW YORK/LONDON, Feb 16 Gold fell for the third
straight session on Tuesday, as global equity markets and the
U.S. dollar rose, depressing interest in gold as a safe-haven
asset and taking it further below last week's one-year high.
Spot gold was down 0.5 percent at $1,203.26 an ounce
at 3:05 p.m. EST (2005 GMT). This follows a steep drop of 2.3
percent on Monday, its biggest one-day loss since mid-July.
"Equity markets are continuing to run and that obviously has
taken a bit of the safe-haven demand component behind metals,"
said David Meger, director of metals trading for High Ridge
Futures in Chicago.
"On top of that, renewed dollar strength has continued to
pressure the metals complex overall."
Wall Street stocks gained on Tuesday, extending a rally from
Friday, as investors snapped up beaten-down consumer
discretionary, industrial and financial stocks. U.S. stocks
opened higher after being closed on Monday for the Presidents
U.S. gold futures for April delivery settled down 2.5
percent from where they stood late on Friday at $1,208.20. Most
U.S. gold trading was closed on Monday.
"All the major financial drivers have been in concert to
help this rise happen - the fed futures curve, the dollar
weakening a bit, and equity markets being much weaker than our
expectations," Deutsche Bank analyst Michael Hsueh said.
"In order for us to think that this is going to change into
a more meaningful bull market, you would have to believe that
the Fed is going to come out with an explicit reversal of their
indicated direction, and to go into some kind of easing
On Tuesday, U.S. Federal Reserve's Neel Kashkari said he
sees a gradual increase in interest rates, while Philadelphia
Fed President Patrick Harker said the Fed may be wise to await
more evidence of higher U.S. inflation before raising rates
Minutes from the Fed's Jan. 26-27 meeting will be released
Goldman Sachs' recommendation to short gold, prompted by the
investment bank's belief that the recent fear-induced rally has
been overdone, also stoked a more cautious sentiment for the
Silver was down 0.7 percent at $15.22 an ounce.
UBS Chief Investment Office Wealth Management Research said
in a research note it raised its three-month silver price
forecast to $13.50-$17.50 per ounce, from $12-$16, and the
12-month forecast to $15.50, from $14.50.
"The lack of catalysts is the key reason for our sideways
view, because weak industrial demand persistently hinders
recovery," UBS said.
Platinum was down 0.4 percent at $928.75 and
palladium was down 0.9 percent at $507.
(Additional reporting by A. Ananthalakshmi in Singapore;
editing by G Crosse, Susan Thomas and Susanna Twidale)