By Lewa Pardomuan
SINGAPORE (Reuters) - Gold extended gains on Monday, hovering near its highest level in almost four months hit last week, and record high exchange-traded fund holdings suggested flight-to-safety buying was gaining pace.
Gold rose to $964.20/965.10 an ounce from $963.00/965.00 late in New York on Friday when it jumped as high as $967.60, its strongest since March 19, as record-high oil and falling U.S. equities sparked buying from investors.
Silver held near its highest level in four months, while platinum matched last week's one-week high. But high prices scared off jewellery makers and gold was still below a lifetime high of $1,030.80 hit in March.
"With the high price right now, physical demand is a little bit slow. It seems there's some resistance at around $970-$972 on the topside," said Dick Poon, manager of precious metals at Heraeus Ltd in Hong Kong.
"The political environment is not clear right now. There are still a lot of problems, so I think the downside is not much for the time being," said Poon, who pegged support around $930.
Investors buy gold as a hedge against inflation, and fears of military confrontation between Iran and Israel have helped send oil prices to lifetime highs. Volatility in equities and currency markets also drives investors into safe-haven gold.
Bullion held by SPDR Gold Trust, the world's largest gold-backed exchange-traded fund, jumped to an historic high of 705.90 tonnes, surpassing a previous record around 663 tonnes in March. NYS-
"A retest of the record high is very possible now," said Adrian Koh, analyst at Philip Futures in Singapore.
"It's definitely very positive for gold now. I guess the break above the $950-$955 region triggered buying and that can be seen in the sharp increase in ETF holdings," said Koh.
Oil fell 48 cents to $144.60 a barrel, hit by a rebound in the dollar after the U.S. Treasury and the Federal Reserve moved to help embattled mortgage lenders Fannie Mae and Freddie Mac. Oil struck another record at $147.27 on Friday. The euro dropped to $1.5896 after the Treasury increased its direct credit lines to the mortgage giants and said it would buy their shares if necessary.
Gold futures for August delivery on the COMEX division of the New York Mercantile Exchange added $4.9 an ounce to $965.5.
Spot platinum rose to $2,030.50/2,050.50 an ounce from $2,023.00/2,043.00 late in New York, having earlier hit a high of $2,045 an ounce. Spot palladium rose to $451.00/459.00 an ounce from $448.50/456.50 an ounce late in New York.
Silver edged down to $18.74/18.79 an ounce from $18.76/18.84 late in New York. It jumped to $18.87 an ounce on Friday, its strongest level since March 19, to track gains in gold.
The most active Tokyo platinum contract for June 2009 delivery on the Tokyo Commodity Exchange fell 48 yen per gram to 6,886 yen.
