The appeal of the gold market may be luring more investors in Asia as weak economic data zap investor sentiment in the region, particularly in Japan and China, but analysts are still waiting for gold to truly shine. Spot gold prices reclaimed the $900-an-ounce level Thursday, providing a catalyst for gains in shares of gold companies in Sydney. Shares of Lihir Gold Ltd. (AU:LGL: news , chart , profile ) were up 4.9%, while Newcrest Mining's (AU:NCM: news , chart , profile ) stock tacked on 2.4% in Sydney trading. In Hong Kong, shares of Zhaojin Gold Mining (HK:1818: news , chart , profile ) rose 1.6% and Real Gold Mining (HK:246: news , chart , profile ) gained 1.4%. "There is little confidence in most investment sectors at this point," said Darin Newsom, DTN senior analyst. "That is drawing investment into gold until global economies begin to stabilize." Jay Zhou, analyst at Sinopac Securities, said the brokerage has an outperform rating on gold stocks and expects average gold prices to be above $900 in 2009, and maybe even rise further to $950 in 2010. "But we think that stock prices will be very volatile in 2009 as we believe gold prices will be very volatile," said Zhou. Adding to gold's appeal, recent economic data from China and Japan -- the world's third- and second-largest economies -- have been downbeat. Exports from China, a pillar of the Chinese economy, are weakening, down 25.7% in February from a year earlier, the Chinese customs agency said Wednesday. See full story. And over in Japan, the economy saw a 12.1% annual rate of contraction in the fourth quarter on a steep decline in exports and a fall in private investment, revised data showed Thursday. See full story. Spot gold's asking price was recently at $912.10, up 0.3%. The precious metal's prices rose above $900 an ounce on Nymex as a weakening U.S. dollar heightened the metal's investment appeal. See Metals Stocks. But gold has pulled back after trading above $1,000 an ounce in late February, its strongest level in nearly a year. In other words, the precious metal isn't as strong as it could be. The advance came in a broadly weak region, with Japan's Nikkei 225 Average dropping 1.7% at 7,250.87, China's Shanghai Composite down 1.9% at 2,099.38, Hong Kong's Hang Seng Index off 0.4% at 11,878.51 and South Korea's Kospi losing 1.6% to 2,491.62. Australia's S&P/ASX 200 was down 0.2% recently. Both the U.S. dollar and gold are viewed as safe havens, said Newsom. The dollar has been rallying, "indicating no inflation at this time," he said. "However, many traders -- Japanese traders included -- believe U.S. policies will be inflationary, in time making gold a better buy on both fronts," he said. For now, it's best not to put too much weight on short-term, day-to-day gold price fluctuations "unless and until we break out above $920 or below $890," said Jeffrey Nichols, managing director at American Precious Metals Advisors & NicholsOnGold.com. "In the meantime, short-term movements will mirror the dollar and the stock market," he said.

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