* SPDR Gold Trust holdings hit lowest since November 2009
* Copper, crude oil dip after weak China, euro zone data
* Gold cuts loss after fake tweet about White House bombing
By Carole Vaporean
NEW YORK, April 23 Gold fell more than 1 percent
on Tuesday as a stronger dollar put pressure on prices and as
the outflow from the world's biggest gold exchange-traded fund
(ETF) accelerated and accentuated an investor shift towards
equities and other assets.
At the mid session, gold, along with markets in stocks,
bonds, oil and other commodities, was roiled briefly by a bogus
report of explosions at the White House. Gold pulled up off its
lows on the fake report.
The early decline retraced some of gold's 1.6 percent rally
from a day earlier, which was spurred by strong physical
Traders said gold prices fell to session lows in overnight
dealings when the dollar firmed in reaction to weaker April
manufacturing data from both China and Germany, and then
lingered at the lower levels.
"I think the whole commodities space came off because of the
weak PMI out of China and the weak PMI out of Europe, especially
Germany," said Heraeus Precious Metals Management metals trader
David Lee. "That combination is dragging everything from copper
to silver to platinum and palladium down. And gold is going down
in sympathy because it's part of the basket."
Gold fell 1.4 percent to a session low of $1,405.44
an ounce and had pared losses to $1,412.70 by 3:14 EDT (1914
GMT), off 0.87 percent. Gold has fallen 15 percent this year.
U.S. gold futures for June delivery were down 0.61
percent at $1,412.30 an ounce.
Shortly after 1 p.m. (1700 GMT), gold prices pulled up off
their lows, U.S. government debt prices surged briefly, and
stocks fell sharply after a false tweet from the Associated
Press said there had been two explosions at the White House and
that President Barack Obama had been injured.
An Associated Press spokesman told Reuters that the Twitter
message reporting two explosions in the White House was "bogus".
The White House said Obama was fine.
The precious metal's retreat off the one-week high it
reached a day earlier reflected investor nervousness about
holding on to gold positions for long, traders said. Many gold
bulls were caught by surprise a week ago when gold slid to its
biggest-ever daily loss in dollar terms.
The metal was also under pressure from a strong dollar and
rebounding equity markets after sales of new U.S. single-family
homes rose in March, indicating the housing market recovery
remains on track.
In other markets, copper fell to an 18-month low and crude
oil was down nearly 1 percent as data revealed a slowdown in
business activity in Germany and China in April. The figures
heightened concerns over global growth.
"Gold is lower as well as other commodities, including crude
oil and base metals, which fell after weaker-than-expected
economic data out of China and Europe, which gave a boost to the
dollar," Commerzbank analyst Carsten Fritsch said.
Traders were also pointing at pressure from a shift in asset
allocation, while Goldman Sachs said it expected further
declines in gold prices on continued ETF outflows as conviction
in holding gold continues to wane.
"What we saw in the past few sessions was a lot of physical
buying in the form of coins and bars but the ETF numbers are
heavily down and we don't necessarily see a resurgence in demand
from the ETF side any time soon," SP Angel analyst Carole
SPDR HOLDINGS AT 3-1/2 YEAR LOW
Holdings of SPDR Gold Trust, the world's largest
gold-backed exchange-traded fund, tumbled 1.6 percent to the
lowest level since November 2009 at 35.51 million ounces. That
followed daily falls of less than 1 percent in the past week.
While some physical buyers have been seeking bargains at
gold's lower prices, investors are cutting exposure due to
worries about central bank gold sales and prospects of an end to
inflationary monetary policy.
Physical buying persisted in Asia even though spot gold has
rebounded more than $100 from last week's lows of $1,321.35.
Premiums for gold bars were at multi-month highs in Singapore
and Hong Kong as supply tightened for coins and other products.
Among other precious metals, silver was down 1.84
percent at $22.95 an ounce, platinum lost 1.09 percent to
$1,412.99 an ounce, and palladium fell 1.44 percent to
$670.72 an ounce.