* Record highs in S&P, Dow after encouraging payrolls
* ECB rate cut, Fed stimulus offer underlying support
* SPDR holdings down, gold held by ETFs lowest Sept 2009
* Coming up: U.S. consumer credit data Tuesday
(Adds market details, updates prices)
By Frank Tang and Clara Denina
NEW YORK/LONDON, May 3 Gold ended flat on
Friday, erasing earlier gains after faster-than-expected U.S.
job growth reduced any need for the Federal Reserve to boost
Bullion posted a 0.3 percent gain for the week, extending
last week's rally of more than 4 percent.
The metal came under pressure as the S&P 500 and Dow
industrials rallied to intraday records after data showed U.S.
nonfarm payrolls rose 165,000 last month and the jobless rate
fell to 7.5 percent, the lowest since December 2008.
Earlier this week, the Fed said it would continue buying $85
billion in bonds each month and step up purchases if needed to
stimulate the U.S. economy, while the European Central Bank cut
interest rates for the first time in 10 months.
"If we continue to get consistently good job numbers, I
would imagine the precious metal markets will start to come off
more aggressively," said Matthew Schilling, commodities broker
at futures brokerage RJ O'Brien.
Spot gold edged up 16 cents to $1,466.40 an ounce by
2:56 p.m. EDT (1856 GMT), reversing a 1.5 percent gain to a
two-week high of $1,487.80 earlier.
U.S. Comex gold futures for June delivery settled
down $3.40 at $1,464.20 an ounce, with trading volume 25 percent
below its 30-day average, preliminary Reuters data showed.
A more than 6 percent rally in copper and gains in other
commodities after the payrolls report supported gold, but the
Dow's rise above 15,000 for the first time dented bullion's
The ECB's decision to cut its main rate to a record low of
0.50 percent on Thursday came a day after the Fed's recommitment
to its stimulus program. In April, the Bank of Japan promised to
inject about $1.4 trillion into its economy to spur growth.
Easy monetary policy extended gold's bull run to a 12th
consecutive year last year, as investors bought bullion to hedge
against inflation and economic uncertainties. Year-to-date,
however, gold is down 12.5 percent on fading inflation fears.
"There is no such thing as a hyperinflation scenario for at
least the Western countries, that's why we think gold will
suffer in the medium term," Danske Bank's Christin Tuxen said.
ETF HOLDINGS KEEP FALLING
Holdings of the SPDR Gold Trust, the world's largest
gold-backed exchange-traded fund, posted the deepest fall in one
week, down 0.6 percent to 1,069.22 tonnes on Thursday, the
lowest level since September 2009.
Gold prices plunged to near $1,320 on April 16, their lowest
in more than two years, after the metal's diminishing appeal as
an inflation hedge prompted investors to slash holdings of
The drop in prices, however, spurred purchases of gold bars,
coins and nuggets across Asia and in other parts of the world,
keeping physical premiums at multi-year highs of around $3 an
ounce to the spot London prices for a few weeks.
Among other precious metals, silver rose 0.9 percent
to $24.01 an ounce. Platinum inched down 51 cents to
$1,493.49 an ounce, while palladium rose 0.4 percent to
2:56 PM EDT LAST/ NET PCT LOW HIGH CURRENT
SETTLE CHNG CHNG VOL
US Gold JUN 1464.20 -3.40 -0.2 1455.40 1487.20 159,067
US Silver JUN 23.994 0.184 0.8 23.530 24.305 787
US Plat JUL 1501.20 1.00 0.1 1483.90 1518.90 11,431
US Pall JUN 693.30 0.00 0.0 686.45 705.50 4,507
Gold 1466.40 0.16 0.0 1456.65 1487.80
Silver 24.010 0.220 0.9 23.450 24.350
Platinum 1493.49 -0.51 0.0 1489.75 1515.50
Palladium 691.72 2.72 0.4 688.75 702.50
TOTAL MARKET VOLUME 30-D ATM VOLATILITY
CURRENT 30D AVG 250D AVG CURRENT CHG
US Gold 172,651 231,626 177,428 19.58 -1.00
US Silver 57,116 77,859 54,971 30.3 -4.33
US Platinum 11,659 14,709 11,933 18.86 -0.06
US Palladium 4,841 5,086 5,082
(Additional reporting by Lewa Pardomuan in Singapore; Editing
by Dale Hudson, James Jukwey and Marguerita Choy)