Gold rose for the first time in nine days in London, rebounding from its longest losing streak since June 2006, as falling stock markets boosted demand for the metal. Silver and platinum also advanced. Bullion dropped 8.7 percent in the eight sessions through yesterday from Feb. 20, when it reached an 11-month high of $1,006.29 an ounce. Merrill Lynch & Co. today raised its 2009 forecast by 11 percent. European shares and U.S. index futures slid as Chinese Premier Wen Jiabao refrained from announcing an expansion of the government’s stimulus package. “Gold is really a buying opportunity” because investors remain concerned about stocks, said Bayram Dincer, a commodity analyst at Dresdner Bank in Zurich. Gold is “still favorable over bonds and equities.” The metal for immediate delivery rose $8.43, or 1 percent, to $914.93 an ounce by 11:45 a.m. local time. April futures added $8.80, or 1 percent, to $915.30 an ounce in electronic trading on the New York Mercantile Exchange’s Comex division. The metal rose to $913.25 in the morning “fixing” in London, used by some mining companies to sell production, from $908.50 at yesterday’s afternoon fixing. Spot prices are up 3.9 percent this year. “Some people were disappointed it couldn’t hold at the $1,000 level,” which triggered selling in the past week, Dincer said. “There’s strong support around $900.” Support levels are where buy orders cluster on charts that traders watch. Growth Target China’s 8 percent growth target for this year is within reach, Premier Wen said today, indicating the government sees no need to increase its stimulus. Governments and central banks are spending trillions of dollars to revive economies, giving rise among some investors to concern about future inflation and adding to bullion’s allure. The European Central Bank will today cut interest rates by half a percentage point to 1.5 percent, the lowest since the European currency was introduced in 1999, according to a Bloomberg survey of economists. Bank of England policy makers will likely halve the U.K.’s main rate to 0.5 percent, a separate survey shows. Bullion has gained every year since 2000. “A surge in inflation expectations in interest rate markets, a rapid increase in credit risk, falling stock markets, and a wave of monetary and fiscal policies are fuelling a gold price rally,” Merrill Lynch wrote in a report. “Things don’t get much better than this for gold.” The bank boosted its forecast for this year’s gold price by 11 percent to $1,000 an ounce. The metal reached an all-time high of $1,032.70 a year ago. Gold Trust Assets in the SPDR Gold Trust, the biggest exchange-traded fund backed by bullion, held at a record 1,029.29 metric tons for a fifth day yesterday. Holdings in the fund have increased 32 percent since the start of the year. Among other metals for immediate delivery in London, silver added 1.5 percent to $13.135 an ounce. Platinum rose 0.7 percent to $1,054.50 an ounce and palladium was 0.6 percent higher at $200.25 an ounce. Fairfax IS Plc raised its 2009 forecast for platinum by 12 percent to $950 an ounce on speculation China’s economy may recover faster than previously expected. Platinum and palladium may rise on expectations for increased demand from automakers, which account for about half the metals’ global consumption, Fairfax said in a report.

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