By Miho Yoshikawa
TOKYO (Reuters) - Gold eased on Tuesday from a seven-week high marked in New York the previous day as waning investor appetite for the precious metal capped gains despite the dollar remaining close to this year's low.
Bullion rose to $962.10 an ounce in New York on Monday, its highest since June 10, boosted by a weaker dollar, which lost some of its safe-haven appeal in the face of a rally on Wall Street and encouraging economic data.
Kazuhiko Saito, chief analyst at Tokyo's Fujitomi Co Ltd, said that while a weaker dollar was continuing to lend support to gold, the precious metal was showing signs of being top heavy.
"Gold has lost some of its appeal as a safe haven ... and it's no longer such an attractive investment instrument," he said.
Investment money was shifting out of gold, he said, which was underscored by a decline in holdings in gold-backed exchange-traded funds, which have been mostly on a downtrend since June.
Traders have said gold may face strong resistance at $960, a level the market has failed to hold above since early June.
Gold stood at $954.00 an ounce at 0600 GMT, down 0.02 percent from New York's notional close of $955.55.
The world's largest gold-backed exchange-traded fund, the SPDR Gold Trust, said holdings stood at 1,072.87 tonnes as of August 3, unchanged since July 29.
Holdings have declined over 5 percent since hitting a record of 1,134.03 tonnes on June 1.
U.S. gold futures for December delivery also eased 0.2 percent to $954.70.
The dollar traded close to its lowest level this year against a basket of currencies on Tuesday after bullish global stocks and upbeat economic data from around the world raised hopes for an economic recovery and increased investor risk-appetite.
U.S. stocks rose on Monday, pushing the S&P 500 index above 1,000 for the first time in nine months, as manufacturing sector data underscored optimism that the economy was recovering.
The rally extended to Tokyo with the Nikkei average rising to its highest point in 10 months on Tuesday.
Platinum held close to New York's closing level on Monday of $1,232.50 per ounce, helped in part by the robust performance of industrial metals.
Saito added, however, that platinum's prospects were not as bright as those of many other industrial metals as demand for platinum was likely to fall as electric cars and other environmentally friendly vehicles are launched.
These zero-emission cars do not need autocatalysts to clean exhaust fumes, which account for more than 50 percent of global platinum demand. Platinum is also used in jewellery, an area where demand is also weak.