NEW YORK, Feb 25 (Reuters) - COMEX gold went from bid to flat early Tuesday, retracing overseas safe-haven gains after the European Central Bank reported a chunky 30-tonne bullion sale last week by one of its national central banks.
"That's what gave the price back from where we were last night," said a floor broker.
Overnight April gold rose to a 13-day high of $360.60 an ounce on market jitters about the U.S. push for a war to disarm Iraq and a provocative missile test by North Korea as the United States seeks a diplomatic solution to the standoff over the Communist country's nuclear program.
At 0923 EST, the active contract was off 40 cents at $356.10 an ounce, not far from the session low of $355.80.
Most of the $4.50 pullback came after the ECB said gold reserves fell by 326 million euros because of the 30 tonne sale last week.
Spot gold was at $357.20/8.00, compared to $356.00/75 late Monday. The morning fix in London was $359.10.
Dealers declined to speculate on which bank dumped the bullion. But they said selling into strength was the best way to take advantage of gold's rally and stabilize the market.
"The funds are happy to take that much," said a bullion dealer.
The Netherlands and Austria are known sellers under the 1999 Washington Agreement on Gold that limited total European gold sales to 400 tonnes a year for five years.
The Bank of England completed a controversial public sales program last year and Switzerland, which is not an ECB member but was party to the gold pact, is slowly reducing gold reserves.
Gold hit its high overnight after North Korea confirmed it fired a missile into the Sea of Japan.
The launch coincided with U.S. Secretary of State Colin Powell's trip to South Korea, China and Japan where he sought help in ending the crisis over Pyongyang's nuclear threats and backing for a new U.N. resolution submitted by the United States, Britain and Spain that could pave the way for a war in Iraq.
The U.N. move opened an intensive period of diplomacy. France and Germany are strongly opposed to the draft and circulated their own plan that would extend U.N. inspections for at least four months. China and Russia backed the French proposal.
No vote is expected on the new resolution for at least two weeks. But dealers said they were betting that the White House would go it alone if its resolution failed.
"In terms of the gold market, it should push it higher eventually and then you sell the smithereens out of it. Then it's all over until the next war," said another gold trader.
March silver was off 1.0 cent at $4.705 an ounce, in a $4.735-$4.69 range. Spot silver fetched $4.70/72, off from $4.71/73 at Monday's close. It fixed at $4.6975 an ounce.
NYMEX April platinum was up $8.20 at $672.00 an ounce, edging back toward the contract and 23-year highs set early this month on hopes for more U.S. investment in platinum intensive fuel cell technology.
Spot was last priced at $676.00/681.00.
March palladium was 35 cents firmer at $251.00 an ounce while spot palladium last fetched $248.00/253.00.