LONDON, Feb 11: Gold rose in Europe on Wednesday, reversing earlier losses, as disappointment with the US bank rescue plan prompted investors to seek out assets such as bullion-backed exchange-traded funds as a haven from risk.

The United States on Tuesday rolled out a revamped bank rescue plan that may cost more than $2 trillion. Stocks slid by the most in two months after the plan was unveiled, while oil and currency markets reacted with scepticism and gold climbed more than 2 per cent as investors sought safety.

It extended those gains to a session high of $921.90 on Wednesday, after falling briefly overnight in Asia as investors took profits.

As long as that carries on, the market is going to be very well supported, he added.Holdings of the world’s largest bullion-backed ETF, the SPDR Gold Trust, rose to a record 894.72 tons on Feb. 10, up 12.85 tons from the previous day.

Strong sales of gold for ETFs, plus coins and bars, are helping to make up for weak jewellery sales in traditionally key bullion markets like India, China and the Middle East.

Indian gold buying eased as prices rose after showing some signs of recovery as the metal slipped earlier this week.

Buying would only come if prices slide below $900 levels, a dealer with a state-run bank in Mumbai said.

A softer dollar typically benefits gold, which is often bought as a hedge against weakness in the US currency.

Spot silver rose to $13.33/13.41 an ounce from $13.10.

Among other precious metals, platinum extended Tuesday’s gains to $1,055/1,060 an ounce from $1,032, while palladium was up at $210.50/215.50 an ounce from $210.

Platinum has risen 6 percent since early Tuesday on the back of hopes there may be light at the end of the tunnel for the global economy, and as platinum miners reported operational cutbacks.

Platinum and palladium, which are used as components in catalytic converters, are highly sensitive to car demand.

—Reuters