Gold edges up after two-day decline

SINGAPORE | Sun Jan 23, 2011 7:55pm EST

SINGAPORE (Reuters) - Spot gold prices edged up on Monday, regaining some lost ground after falling for two consecutive days, while holdings in the SPDR Gold Trust rose for the first time in two weeks, as investors entered the market for bargain-hunting.
FUNDAMENTALS

* Spot gold gained 0.4 percent at $1,347 an ounce by 0039 GMT.
* U.S. gold futures also rose by 0.4 percent to $1,346.5.
* An improved economic outlook dimmed gold's appeal as safe-haven investment, driving gold to $1,337.5 on Friday, its lowest in more than two months.
* But holdings in the SPDR Gold Trust, the world's largest gold-backed exchange-traded fund, jumped 1.6 percent to 1,271.769. It was the first rise in about two weeks.
* German business morale rose to its highest level in 20 years in January, surging past economists' forecasts on the back of a manufacturing sector now fully recovered from the 2008 financial crisis.
* Speculative net long positions in U.S. gold futures fell to 164,993 by Jan 18, from 177,372 a week earlier, the U.S. Commodity Futures Trading Commission said.
* Holdings in the iShares Silver Trust, the world's largest physically backed exchange-traded fund, fell 1.3 percent to 10,394.53 tonnes, its lowest since early November.
* Spot silver rose by 0.7 percent to $27.66 an ounce, recovering from a three-day losing streak that took the metal to $27.10 on Friday, its lowest since end of November.

MARKET NEWS

* The euro backed away from a nine-week high early in Asia on Monday in the face of heightened political uncertainty in Ireland, but euro bears were wary of becoming too negative having been badly burned in the last couple of weeks. <USD/>
* The Dow and S&P 500 rose on Friday as General Electric Co's (GE.N) earnings put a positive tone on the economic recovery, snapping a two-day losing skid for the benchmark index. .N
PRICES
Precious metals prices 0039 GMT
Metal Last Change Pct chg YTD pct chg Turnover
 Spot Gold 1347.00 4.75 +0.35 -5.10
Spot Silver 27.66 0.19 +0.69 -10.37
Spot Platinum 1827.57 3.57 +0.20 3.40
Spot Palladium 820.47 0.72 +0.09 2.62
TOCOM Gold 3598.00 -5.00 -0.14 -3.51 27541
TOCOM Platinum 4918.00 51.00 +1.05 4.73 3700
TOCOM Silver 73.60 1.10 +1.52 -9.14 833
TOCOM Palladium 2188.00 38.00 +1.77 4.34 225
Euro/Dollar 1.3592
Dollar/Yen 82.71
TOCOM prices in yen per gram. Spot prices in $ per ounce.