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Gold drifts lower, funds boost platinum

LONDON: Gold drifted in Europe on Tuesday, but platinum managed to get a boost from fund buying, traders said.

"There's just not really any reason to buy gold at the moment, so people aren't. It's been deadly today, really quiet," said one London-based trader.

Bullion prices stayed in their tight range between $280 resistance and $275 support.

Spot gold ended at $276.70/$277.20, down from a New York close of $277.70/$278.70, in low volume.

While sentiment was still fairly negative, traders saw support coming from volatile equity markets.

By 1500 GMT the technology-laden Nasdaq had fallen 3.6 percent after its sharp drop on Monday -- largely due to an antitrust ruling against Microsoft .

"As long as equity markets are variable, some people might be bailing out and moving into other investments like gold," said another trader, citing $276 as initial support.

While silver also lacked impetus, platinum was the biggest mover among the precious metals -- but again, only small volumes were traded.

"We've seen some fund buying in New York, and there's good physical support," said another dealer. "But there's still not much business going on."

Platinum was last quoted up 2.4 percent at $515.00/$523.00 from a close of $503.00/$508.00.

Palladium was dull, reflecting the lack of news on Russian deliveries.

"Eventually something will happen, but it's anyone's guess when," added the dealer.

Palladium ended almost unchanged at $580.00/$595.00 from New York's $578.00/$608.00.

Like gold, silver lacked direction.

Dealers said trade was so thin that it was not enough to generate any price moves outside the $4.95/$5.05 range.

"And I don't think there's any reason for that to change soon," said one trader.

Silver closed at $5.04/$5.06, little changed from the $5.02/$5.04 close.-Reuters