March 2 (Bloomberg) -- Gold climbed for the first time in six sessions in London as stock markets tumbled on speculation that economies are worsening, adding to the metal’s appeal as a store of value. Platinum also gained.

European and Asian equities dropped and U.S. stock-index futures fell after billionaire investor Warren Buffett said the American economy is in a “shambles.” A revised government bailout for insurer American International Group Inc. fanned concern that financial companies may need more capital. Gold lost 5.1 percent last week, the most since early December.

“Deepening fears surrounding the global economic picture have lifted gold,” James Moore, an analyst at TheBullionDesk.com in London, wrote today in a note. The metal will likely trade between $930 an ounce and $970 an ounce in the “short term” before climbing to a record on concern economies may deteriorate, he said.

Bullion for immediate delivery rose as much as $16.16, or 1.7 percent, to $958.51 an ounce and traded at $948.63 at 1:20 p.m. local time. April futures gained $6.60, or 0.7 percent, to $949.10 an ounce in electronic trading on the New York Mercantile Exchange’s Comex division.

Gold, which reached a record $1,032.70 an ounce a year ago, is up 7.5 percent this year. The MSCI World Index has slid 20 percent, with Citigroup Inc., Swiss Reinsurance Co. and other financial companies posting most of the 10 biggest drops.

Losing Streak

The metal fell to $949.50 in the morning “fixing” in London, used by some mining companies to sell production, from $952 at the Feb. 27 afternoon fixing. Last week’s five-day drop for spot prices was the worst losing streak since September.

“Despite the correction, many analysts consider the upside momentum still intact, given there’s no end in sight for troubles in the financial sector,” London-based broker ODL Securities Ltd. said today in a report.

AIG reported a $61.7 billion fourth-quarter loss, and HSBC Holdings Plc said it will raise 12.5 billion pounds ($17.7 billion) in a rights offer. Some investors are buying gold as a hedge against future inflation as governments and central banks spend trillions of dollars to combat the worst financial crisis since the Great Depression.

Bullion rose to an 11-month high of $1,006.29 an ounce on Feb. 20. Spot prices may rebound this week as investors seek a haven, according to 20 of 31 traders, investors and analysts surveyed from Tokyo to Chicago last week. Seven respondents advised selling and four were neutral.

Scrap Sales

Still, hedge-fund managers and other large speculators decreased their net-long position, or bets prices will rise, by 2 percent in New York gold futures in the week ended Feb. 24, according to U.S. Commodity Futures Trading Commission data.

Gold fell last week after higher prices spurred sales of scrap metal. Gold imports by India, the world’s biggest consumer, fell for the fourth straight month to almost nil in February, according to provisional estimates from the Bombay Bullion Association Ltd.

Assets in the SPDR Gold Trust, the biggest exchange-traded fund backed by bullion, held at a record 1,029.29 metric tons as of Feb. 27. Holdings in the fund have increased 32 percent since the start of the year as investors sought a store of value.

Among other metals for immediate delivery in London, silver added 0.1 percent to $13.13 an ounce. Platinum added 1.7 percent to $1,092 an ounce, and palladium gained 0.3 percent to $196.50 an ounce.

To contact the reporter on this story: Nicholas Larkin in London at nlarkin1@bloomberg.net

Last Updated: March 2, 2009 08:24 EST