SINGAPORE, Jan 12 (Reuters) - Spot gold edged higher on
Tuesday, snapping two sessions of decline, as concerns over
China's economic growth and pressure on stock markets lifted the
precious metal.
FUNDAMENTALS
* Spot gold XAU= firmed 0.2 percent to $1,095.6 an ounce
by 0037 GMT, while U.S. gold futures GCcv1 eased 0.1 percent
to $1,095.2.
* China's main stock indexes .SSEC .CSI300 each dropped
more than 5 percent on Monday. Oil prices fell to new 12-year
lows, as concerns over China hurt commodity prices broadly.
* Right from the beginning of 2016, markets have been rocked
by plunges in Chinese stocks, the yuan's fall and subsequent
heavy intervention by the Chinese authorities.
* The chaotic moves have led to worries China's economy may
be in for tough time rather than stabilising as some had hoped.
* China is the world's biggest consumer of gold at around
1,000 tonnes a year.
* The yellow metal is often seen as an alternative
investment during times of financial uncertainty, although
safe-haven rallies tend to be short-lived.
* The gain in gold prices is likely to be capped by concerns
that higher U.S. interest rates would lower demand for the
non-interest-paying asset, while boosting the dollar. The Fed
raised rates in December and attention has shifted to how many
hikes will follow in 2016.
* Atlanta Federal Reserve Bank President Dennis Lockhart
said there may not be enough fresh data on inflation to support
another U.S. interest rate hike by March.
* Holdings of the world's largest gold-backed
exchange-traded fund, New York-listed SPDR Gold Shares (N:GLD), rose
0.69 percent on Friday, data from the fund showed.
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MARKET NEWS
* Asian shares hovered near four-year lows and oil prices
languished at near 12-year lows on Tuesday as investors fretted
over whether Beijing may be losing control of the economy.
MKTS/GLOB
DATA AHEAD (GMT)
0930 Britain Industrial output Nov
1100 U.S. NFIB business optimism Dec