Gold hovered near a one-week low on Friday, pressured by strength in equities, while dealers took a drop from record holdings in the world's largest gold-backed exchange-traded fund as a sign investor demand may be receding.
Holdings by New York's SPDR Gold Trust fell 0.7 percent from the record high it first reached -- then subsequently maintained -- on April 9.
Holdings fell to 1,119.43 metric tons by April 16, down 8.25 metric tons from the previous day. The trust's holdings have fallen about 1 percent so far in April, versus a rise of roughly 4 percent in the comparable period last month.
Gold fell to a one-week low on Thursday on signs of a slowdown in investment demand on budding optimism that the economy was on the mend.
Sluggish physical buying has also failed to provide much support for prices, analysts said.
"Gold markets are much lower.... as the stock markets are moving higher again," said Adrian Koh, an analyst at Phillip Futures.
Koh said that although he was technically a little bearish about gold in the near term, he believed gold's long-term prospects remained solid.
"Yes, we are starting to see a bit of a decline (in the SPDR), but it's still not a very large figure, compared to how much we have gained in gold holdings over the past couple of months," he said.
Gold was at $874.70 per ounce by 10:50 p.m. EDT, up 0.02 percent from New York's notional close of $874.55.
It has fallen about 2 percent since the beginning of this week.
India's gold buyers continued to trickle in to stock up the yellow metal to meet festive demand, traders said.
Akshaya Tritiya, which falls on April 27, is the second-most auspicious day to buy gold after Dhanteras.
Japan's Nikkei average rose 2.2 percent as banks climbed after reassuring earnings from JPMorgan, while steelmakers surged on a report that Nippon Steel (5401.T) had negotiated a smaller-than-expected price cut with Toyota Motor Corp (7203.T).
The yen slipped against the dollar and other majors on Friday as short-term traders pushed it down.
Signs that the global economic downturn may be easing have helped boost platinum, which is used in autocatalysts.
The metal, also used in jewelry, has fallen a touch since hitting a 6-1/2-month high of $1,244 per ounce on Monday, but has managed to stay above $1,200.
