Palladium steady near 13-1/2 year high on supply fears

SINGAPORE (Reuters) - Palladium held steady near a more than 13-year high on Thursday, as supply concerns from a five-month strike in second-largest producer South Africa triggered buying from industrial users and investors.

FUNDAMENTALS

* Cash palladium was little changed at $857.15 an ounce by 0019 GMT. The metal used in jewellery and auto catalysts rallied to $862.50 an ounce on Wednesday, its highest level since February 2001.

* Spot gold was barely changed at $1,261.09 an ounce. The metal is holding above a four-month low of $1,240.61 hit last week.

* As annual wage talks kick off in South Africa, a five-month strike in the platinum sector weighs large and could influence how other unions negotiate pay demands this year.

MARKET NEWS

* A gauge of world stock markets retreated from recent highs on Wednesday, pressured by a lower growth forecast from the World Bank and a profit warning from Lufthansa, while Brent crude rose on fears of disrupted supply from Iraq as violence escalates.

* The dollar edged lower against a basket of major currencies on Wednesday for the first time in four sessions after traders dismissed expectations of an early Federal Reserve rate hike, while the yen advanced on few signs of further easing from the Bank of Japan.

(Reporting by Lewa Pardomuan; Editing by Richard Pullin)