* Gold ends up, breaks seven-session consecutive drop
* Analysts speculate whether Fed may trim stimulus soon
* Physical demand soft, Indian premiums halve
* Coming up: U.S. weekly jobless claims Thursday
(Updates market activity)
By Frank Tang and Clara Denina
NEW YORK/LONDON, Nov 6 Gold rose on Wednesday,
halting its longest losing streak in nearly six months, boosted
by a dollar drop and expectations that the U.S. Federal Reserve
will extend its monetary stimulus.
Trading volume continued to be weaker than usual, a sign
that the record-high equities market has weighed down on bullion
investor interest. The S&P 500 equities index was up 0.3
Earlier this week, one senior Federal Reserve official said
the U.S. central bank should scale back its asset purchases only
when the economy shows clearer signs of improvement and even
then it should act slowly, while two others stressed there is no
need to rush.
However, Friday's strong U.S. manufacturing activity report
left some market watchers to speculate that the Fed could taper
its bond-buying stimulus before year-end.
"We expect U.S. economic data to continue to have an
outsized impact on gold for the near term," said James Steel,
HSBC chief metals analyst. "Given the recent string of
better-than-expected U.S. economic data, gold may test the
$1,300 an ounce level ahead of the payrolls report."
Spot gold was up 0.5 percent at $1,317.24 an ounce by
1:53 p.m. EST (1853 GMT). The metal had dropped 3 percent over
the past seven sessions, which matched the longest losing streak
set in early May.
U.S. Comex gold futures for December settled up $9.70
at $1,317.80 an ounce, with trading volume on track to finish
about 50 percent below its 250-day average, preliminary Reuters
Futures turnover has been low over the past few sessions,
and investors are expected to remain cautious ahead of U.S.
non-farm payrolls data on Friday, which could give more clues on
the state of the economy and the future of the Fed's stimulus.
"The relative weakening of the dollar is giving some support
today but ... if the non-farm payrolls come in better than
expected on Friday, then we could see gold lose that support,"
Mitsubishi analyst Jonathan Butler said.
The dollar fell against the euro on stronger-than-expected
German economic data and as investors waited to find out what
steps the European Central Bank (ECB) might signal at its policy
meeting on Thursday.
SLOW PHYSICAL DEMAND
Demand for physical gold has failed to pick up robustly as
traders await clearer price direction.
Gold premiums in India halved on Tuesday from levels last
week because of unusually muted demand during the festival
season and as supply was set to improve after some importing
agencies began purchasing for domestic use.
Among other precious metals, silver rose 0.6 percent
to $21.79 an ounce, platinum gained 0.9 percent to
$1,460.99 an ounce, while palladium rose 1.8 percent to
$759.97, having earlier climbed to its highest level since
mid-August at $761.75.
1:53 PM EDT LAST/ NET PCT LOW HIGH CURRENT
SETTLE CHNG CHNG VOL
US Gold DEC 1317.80 9.70 0.7 1308.90 1322.00 87,317
US Silver DEC 21.768 0.132 0.6 21.620 22.075 30,190
US Plat JAN 1467.40 17.40 1.2 1450.00 1469.90 6,259
US Pall DEC 764.35 14.05 1.9 749.50 764.95 5,668
Gold 1317.24 6.25 0.5 1309.68 1321.70
Silver 21.790 0.140 0.6 21.650 22.040
Platinum 1460.99 13.25 0.9 1452.50 1467.00
Palladium 759.97 13.50 1.8 751.50 761.75
TOTAL MARKET VOLUME 30-D ATM VOLATILITY
CURRENT 250D AVG CURRENT CHG
US Gold 101,311 189,283 19.79 -0.22
US Silver 36,647 58,610 27.83 -0.34
US Platinum 6,397 12,978 18.17 -0.05
US Palladium 6,313 5,806
(Additional reporting by A. Ananthalakshmi in Singapore;
editing by Jane Baird, Keiron Henderson, Phil Berlowitz and