* Drop in US jobless claims stirs ideas of Fed tapering
 * Platinum hits four-month low on technical selling
 * China's imports from Hong Kong highest in seven months
 * Coming up: U.S. markets shut on Thursday
    By Frank Tang and Clara Denina
    NEW YORK/LONDON, Nov 27 (Reuters) - Gold fell on Wednesday,
erasing initial gains, as a drop in U.S. jobless claims
supported expectations the Federal Reserve will soon scale back
its monetary stimulus, traders said.
    Platinum dropped about 1.5 percent to a four-month low,
underperforming other precious metals, on pressure from
technical selling that developed when prices fell below support
at $1,350 an ounce.
    Bullion prices were down for a second consecutive day after
the unexpected drop in last week's U.S. jobless claims. However,
 a separate report showed continued weakness in business
spending on capital goods.
    As a gauge of gold interest among funds and institutional
investors, holdings in gold-backed exchange-traded funds fell on
Tuesday, extending a trend of heavy outflows.
    "Negative sentiment and weak physical demand trends indicate
further weakness in gold prices may continue in the months
ahead," said Robert Haworth, senior investment strategist at the
Private Client Reserve at U.S. Bank Wealth Management.
    Gold investors digested news that Venezuela is evaluating a
swap agreement involving gold reserves as a way to fortify
dollar supplies in the OPEC nation, a senior government source
told Reuters on Wednesday.
    Spot gold was down 0.3 percent at $1,239 an ounce by
1:57 p.m. EST (1857 GMT), after rising nearly 1 percent earlier
in the day.
    U.S. gold futures settled down $3.60 at $1,237.80 an
ounce. Trading volume was at 220,000 lots, preliminary Reuters
data showed, nearly 35 percent above its 30-day average of
165,000 lots.
    Strong turnover was largely boosted by the December-February
contract roll over ahead of the December contract's first-notice
day on Friday, traders said.
    With U.S. markets shut on Thursday for the Thanksgiving
holiday, market activity is expected to slow and not pick up
until next week, traders said.
    CHINESE DEMAND
    Losses in the gold market were limited after data showed
China's net gold imports from Hong Kong hit the highest in seven
months in October.
    Chow Tai Fook Jewellery Group, the world's largest
jewellery retailer by market value, posted a 92 percent rise in
net profit for the six months ended in September.
    Platinum fell 1.3 percent to $1,350.99 an ounce,
having earlier hit a four-month low of $1,347.25.
    "Platinum was down due to a steady downtrend in commodities
because of deflation worries and a lot of technical support
being breached," said Adam Sarhan, chief executive of Sarhan
Capital.

    Silver dropped 1 percent to $19.64 an ounce, and
palladium eased 0.3 percent to $713.72 an ounce.
 1:57 PM EST     LAST/    NET   PCT      LOW    HIGH  CURRENT
                SETTLE   CHNG  CHNG                       VOL
 US Gold JAN   1237.80  -3.60  -0.3  1237.20 1253.20      438
 US Silver MAR  19.682 -0.211  -1.1   19.665  20.140   41,024
 US Plat JAN   1352.70 -19.20  -1.4  1351.80 1385.30   10,412
 US Pall MAR    715.95  -2.50  -0.3   715.50  726.30    4,615
 Gold          1239.00  -3.90  -0.3  1238.33 1254.20
 Silver         19.640 -0.190  -1.0   19.650  20.100
 Platinum      1350.99 -17.11  -1.3  1355.75 1382.75
 Palladium      713.72  -2.25  -0.3   717.75  723.25
 TOTAL MARKET              VOLUME          30-D ATM VOLATILITY
                CURRENT   30D AVG  250D AVG   CURRENT     CHG
 US Gold        220,952   164,655   187,471        19   -0.17
 US Silver       67,199    56,389    57,404      24.6   -1.72
 US Platinum     10,805     9,465    12,889     16.15   -0.62
 US Palladium     7,386     8,099     5,934     20.42   -0.40
Source: http://www.reuters.com/article/2013/11/27/markets-precious-idUSL4N0JC21020131127