* Gold extends gains after rising 5 pct last week
* Gold ETF holders add to physical position -SPDR
* Speculators boost bullish bet in COMEX gold to 3-month top
(Updates throughout, adds comment, changes dateline to LONDON
By Susan Fenton
LONDON, Feb 8 Gold hit three-month highs on
Monday, extending its biggest weekly rise since July 2013 as
sliding stock markets, global growth uncertainty and a softer
dollar prompted investors to seek safety in hard assets.
Spot gold reached a peak of $1,176.90, its strongest
since Oct. 28, and was at $1,176.66 an ounce at 1104 GMT, up 0.3
The metal climbed 5 percent last week and has risen more
than 10 percent since the start of 2016, reversing last year's
10.4 percent loss.
The pan-European FTSEurofirst 300 was down 2.5
percent at 1,251.09 points, hitting its lowest since October
2014 on worries about economic growth.
"There's certainly continued elevated volatility coming from
oil prices, weaker equities," said ETF Securities analyst Martin
Arnold. "We think there is more upside. The next big level is
$1,200, but it may take a while to test it."
The dollar eased as markets reverted to the idea that the
U.S. Federal Reserve may not raise interest rates as many times
as had previously been expected.
Lower rates cut the opportunity cost of holding gold, which
earns no yield but costs to store and insure.
The metal slid on Friday after the monthly U.S. jobs report
suggested growth could be strong enough for higher U.S. rates,
but quickly recovered.
Even if the Fed does raise rates further, it may not be by
as much as the four rate hikes that financial markets had been
pricing in a few weeks ago.
U.S. gold for April delivery was up 1.29 percent at
$1,172.7 an ounce.
Hedge funds and money managers boosted their bullish bet in
COMEX gold to a three-month high in the week to Feb. 2, U.S.
Commodity Futures Trading Commission data showed on Friday.
"The recent CFTC data suggests speculators continue to trim
short positions and bulls are also returning to the market," ANZ
said in a note. "The uncertainty around the Fed tightening cycle
is likely to support gold prices in coming weeks."
Positive sentiment was also boosted by SPDR Gold Trust
, the world's largest gold-backed exchange-traded fund,
which said its holdings rose 0.7 percent to 698.46 tonnes on
The week-long Lunar New Year holiday in leading gold
consumer China and other Asian countries starting on Monday
means support from the physical market may be lacking, however.
Across other metals, platinum which tracked gold
higher last week, slipped by 0.6 percent to $902.25 and
palladium fell 1 percent to $495.50 an ounce.
Silver was down 0.2 percent at $14.94 an ounce.
(Editing by Pratima Desai and Jan Harvey)