NEW YORK, April 14 (Reuters) - New York gold futures dropped on Tuesday
as better overall economic sentiment dampened strong safe-haven investment
demand in the yellow metal.

 GOLD

 * Gold for June delivery GCM9 fell $7.20 to $888.60 an ounce at 10:03
a.m. EDT (1403 GMT) on the COMEX division of the New York Mercantile
Exchange.

 * Ranged from $888.00 to $899.70.

 * Gold futures initially extended losses after a government report
showed that U.S. producer prices unexpectedly fell in March and recorded
their largest year-over-year decline.

 * A combination of stronger dollar and lower crude oil prices also
weighed down on bullion.

 * Investors showed signs of sentiment change, which may boost risk
appetite and equity markets at the expense of debt and safe-haven markets -
Tom Pawlicki, precious metals and energy analyst at MF Global.

 * U.S. brokerage Goldman Sachs Group Inc posted much
higher-than-expected quarterly profit and said it plans to a $5 billion
common share sales to pay back government funds.

 * The surge in equity markets and signs of a better performance by U.S.
banks may be calming some investors' fears - John Reade, UBS head of metals
strategy.

 * However, U.S. stocks fell over 1 percent on weak retail sales and
producer prices data, limiting gold's losses.

 * While scrap supply remains very low, signs of life in the jewelry
market when gold was on its recent lows are reassuring - Reade.

 * Gold futures stalled near the $900 key resistance level - traders.

 * Gold/oil ratio at 18.0 on Tuesday, higher than 17.8 in the previous
session.

 * Spot gold <XAU=> traded at $888.30, down 0.4 percent from its late
Monday quote in New York.

 * The London morning gold fix <XAUFIX=> was quoted at $895 an ounce.

 SILVER

 * COMEX May silver SIK9 down 16.8 cents, or 1.3 percent, at $12.600
an ounce as investors took profits after Monday's gains.

 * Ranged between $12.550 and $12.795.

 * Spot silver <XAG=> was at $12.57 an ounce, down 1.2 percent from its
previous finish.

 * The London silver fix <XAGFIX=> rose to $12.65 an ounce.

 PLATINUM

 * NYMEX July platinum PLN9 down $24.50, or 2.0 percent, at $1,222.50
an ounce following Monday's rally based on optimism related to China's
autocatalyst demand.

 * PGMs are used in catalytic converters to clean exhaust fumes for
vehicles.

 * Spot platinum <XPT=> at $1,213.50 an ounce, down 1.9 percent from its
late Monday quote.

 PALLADIUM

 * June palladium PAM9 down $5.35, or 2.2 percent, at $237.00 an
ounce, following platinum's weakness.

 * Spot palladium <XPD=> was at $234.00 an ounce, down 1.3 percent from
its previous finish.