* New investors longer term positive for silver - analyst
* Chinese investors jump on silver * India slashes import tax on gold, silver by 5%
* Gold-silver ratio falls to multi-year low
(Updates prices)
By Shreyansi Singh
Feb 1 (Reuters) - Silver stretched its rally to a third
session on Monday, jumping as much as 11.2% to a near eight-year
high as retail investors switched focus to the metal from
GameStop Corp GME.N and other stocks hyped up in social media.
As of 2:27 p.m. EST (1927 GMT), spot silver XAG= was up
6.6% at $28.78 an ounce, easing back slightly after hitting its
highest since February 2013 at $30.03.
Paving the way for a 19% surge in prices since Thursday,
posts began circulating on Reddit appealing to small investors
to buy silver mining stocks and exchange-traded funds (ETF)
backed by physical silver bars. "This social media speculation is at the early stage for
silver and there is uncertainty about how much more momentum we
can have," said Edward Moya, senior market analyst at OANDA,
adding that due to positive fundamentals, the addition of new
investors will be a longer term positive for silver.
Data from iShares Silver Trust ETF SLV , the largest
silver-backed ETF, showed its silver holdings HLDISHAST=XAG
jumped by a record 37 million shares from Thursday to Friday
alone, each representing an ounce of silver.
While a lot of people came in "very enthusiastic" that
they're going to see moves in silver similar to what happened
with GameStop and other companies, "they now realize there is
not as much buying pressure pushing it up like some had
thought", said Michael Matousek, head trader at U.S. Global
Investors.
Some of them were lightening up their positioning and that
could be responsible for the light pullback, he added.
Spot gold XAU= rose 0.8% to $1,860.93 per ounce, while
U.S. gold futures GCv1 settled up 0.7% at $1,863.90.
Experts caution that gold's relatively subdued performance
suggests silver's rally may not last long. An ounce of gold
currently buys 63.6 ounces of silver, compared with 73.3 ounces
on Jan. 25.
Platinum XPT= jumped 5.2% to $1,128.83 an ounce, while
palladium XPD= rose 0.4% to $2,235.75.
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Holdings in the world's largest silver ETF, iShares Silver
Trust, spike to record peak https://tmsnrt.rs/3cpqJmB
Silver has outperformed gold in price terms and in ETF holdgings
in recent months https://tmsnrt.rs/39CYA9y
Gold-silver ratio falls to multi-year low https://tmsnrt.rs/39BU6jS
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