* Gold up for second straight day
* Asian demand for physical gold remains soft
* COMING UP: U.S. retail sales report on Thursday (Updates prices, adds comment)
By Marcy Nicholson and Jan Harvey
NEW YORK/LONDON, June 9 (Reuters) - Gold rose on Tuesday as European stock markets fell and commodities picked up across the board, but prices remained range-bound as investors awaited clearer signals on the timing of an expected U.S. interest rate hike.
Spot gold was up 0.3 percent at $1,176.88 an ounce at 3:27 p.m. EDT (1927 GMT), while U.S. gold futures for August delivery settled up $4 at $1,177.60 an ounce.
Gold fell to $1,162.35 on Friday, its lowest level since March 19, after upbeat data on U.S. job openings bolstered expectations the Federal Reserve would lift interest rates for the first time in nearly a decade in September.
That would raise the opportunity cost of holding non-yielding bullion, while boosting the dollar, in which it is priced.
“I still think the market is in sell-rally mode and will test lower levels once the rate hike appears to be a certainty,” said Steve Scacalossi, director of TD Securities’ Global Metals group in New York.
“However, I think it will become a huge bear trap as the pace of rate hikes will be slower than anticipated and I expect higher prices by end of year.”
Investors are awaiting further clues to the health of the economy before extending Friday’s move, analysts said.
“In terms of data, investors really want to be sure that retail sales are also good this week. They don’t want to run ahead of themselves,” ABN Amro analyst Georgette Boele said, referring to the scheduled release on Thursday of U.S. retail sales for May.
European shares fell on Tuesday on weak economic data out of China and uncertainty about Greece’s debt negotiations, while U.S. stocks were little changed after falling early in the session. MKTS/GLOB]
The dollar was slightly weaker against a basket of currencies in choppy trading.
General strength in commodities also boosted gold, with benchmark Brent crude oil futures up 3.5 percent and copper prices also rising.
In the physical markets, there were signs of bargain-hunting by Chinese consumers after Friday’s drop in prices. Premiums on the Shanghai Gold Exchange were about $2.50 an ounce to the global benchmark, up slightly from $1.50 to $2 last week.
“I don’t think the fall in gold is over,” said Afshin Nabavi, head of trading at MKS. “We’re not seeing any kind of real interest on the physical front, so for me it points to an eventual breach of $1,150.”
Among other precious metals, silver was up 0.2 percent at $15.94 an ounce, while platinum rose 0.3 percent to $1,103.50 and palladium edged down 0.3 percent to $739.50. (Additional reporting by A. Ananthalakshmi in Singapore; Editing by David Goodman and Paul Simao)