MANILA, Aug 26 (Reuters) - Gold edged up on Wednesday after
falling the most in five weeks the session before as global
equities were revived after China cut interest rates and bank
reserve requirements to support a flagging economy.
But China's move appears to have only boosted equities
temporarily, with U.S. stock futures ESc1 resuming their
descent and Asian shares slightly lower. Further losses in
equities could switch appetite back to safe-haven assets such as
gold.
FUNDAMENTALS
* Spot gold XAU= was up 0.4 percent at $1,144.40 an ounce
by 0045 GMT, after losing 1.2 percent on Tuesday. That was
bullion's biggest drop since July 20, and pulled it further away
from a recent seven-week high.
* U.S. gold for December delivery GCcv1 rose 0.5 percent
to $1,143.60 an ounce.
* China's central bank cut interest rates and reduced the
amount of reserves banks must hold for the second time in two
months on Tuesday amid a stuttering economy and a plunging stock
market that has sent shockwaves around the globe.
* Palladium XPD= was off 0.3 percent at $534.50 an ounce
after tumbling more than 6 percent overnight, its steepest fall
since April 2013. The metal, mainly used in emissions control
systems for cars, trucks and other vehicles, slid to a five-year
trough of $528.50 and has lost 11 percent so far this week.
* U.S. consumer confidence hit a seven-month high in August
and new single-family home sales rebounded in July, suggesting
underlying strength in the economy that could still allow the
Federal Reserve to raise interest rates this year.
* But Ray Dalio, the founder of the world's largest hedge
fund Bridgewater Associates, said the firm believes the next big
move by the Federal Reserve will be to loosen U.S. monetary
policy, not tighten it.
* Gold has failed to rally in the face of China's stock
market crisis as investors, scorched by a brutal end to the
market's 12-year bull run, chose cash and bonds for safety over
bullion while they seek clarity on the timing of a U.S. rate
increase.
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MARKET NEWS
* The dollar edged down against the euro and yen as
sentiment remained shaky even after China embarked on
much-anticipated policy easing steps. USD/
* U.S. crude steadied as oversold conditions tempted some
buyers, but prices were kept in check by concerns over a global
glut and fears of a hard landing for China's economy. O/N
DATA AHEAD (GMT)
1230 U.S. Durable goods orders Jul