Tensions stemming from the U.S.-China trade war escalated sharply over the last few days, with much happening as Asian markets were shut down for the weekend.China Economyread more
* Trump says he will hike U.S. tariffs on Chinese goods this week
* Gold specs switch net long position in week to April 30
* SPDR gold holdings fall to lowest since Oct. 11 (Adds comments, updates prices)
May 6 (Reuters) - Gold edged up on Monday as a slide in global share markets after Trump administration's threat of further tariffs on China prompted investors to favor safe-haven assets, but bullion's upside was capped by a firm dollar.
Spot gold gained 0.2 percent to $1,281.76 per ounce as of 02:22 p.m. EDT (1822 GMT). U.S. gold futures settled up 0.2 percent at $1,283.8 an ounce.
"We had two big geo-political events over the weekend, one is the news from Iran with U.S. carrier, bombers group headed to Middle East and all the stuff with China about tariffs," said Bob Haberkorn, senior market strategist at RJO Futures.
The two geo-political risk events should have helped gold trade higher but the dollar strengthened on U.S. President Donald Trump's comments, which has kept gold prices in check, he added.
The U.S. dollar firmed against most major currencies on Monday after Trump said he would raise tariffs on $200 billion worth of Chinese goods this week.
Trump said he would target a further $325 billion of Chinese goods with 25 percent tariffs "shortly," essentially covering all products imported into the United States from China.
Stocks around the world tumbled and oil prices slumped after Trump's announcement, improving the appeal of bullion, seen as an alternative investment during times of political and financial uncertainties along with the Japanese yen and U.S. Treasuries.
Also helping bullion was news, disclosed by Trump's national security adviser John Bolton on Sunday, that the United States was deploying a carrier strike group and a bomber task force to the Middle East to send a clear message to Iran.
Reflecting investors sentiment toward gold, speculators switched to a net long position in COMEX gold in the week to April 30, the U.S. Commodity Futures Trading Commission (CFTC) said on Friday.
"People are pretty complacent about the equity markets for the past few months. And the recent sell-off is making investors to rethink about their portfolio," said Michael Matousek, head trader at U.S. Global Investors.
"A lot of them see they have underweighted gold and are adding to their position a little bit."
Meanwhile, holdings of SPDR Gold Trust, the world's largest gold backed exchange, slipped to their lowest since Oct. 11. Holdings fell 0.6 percent on Friday.
The U.S. tariffs on China, the world's biggest auto market, also weighed on palladium prices. The auto-catalyst metal slipped 2.7 percent to $1,334.01 per ounce.
Silver fell 0.2 percent to $14.90 per ounce, while platinum gained 0.4 percent, to $872. (Reporting by Brijesh Patel and Diptendu Lahiri in Bengaluru; Editing by Tom Brown)