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A salesman displays gold bars inside a jewellery shop in Hyderabad May 6, 2011.Reuters file

The Santa is in shining gold this year, showering Christmas blessings on the commodity's traders. Rudolph the reindeer is casting hardly a glance at the equities market where the bears are at play, killing all Santa rally hopes.

Spot bullion rose to $1,271.36 an ounce, the highest since June, before trading at $1,268.13 in early trade in Singapore.

Gold has hit the highest in six months as global turmoil in equities continued stoking outlook fears for the New Year, marred by US government's partial shutdown and oil worries.

Bullion rose on Wednesday in Asian markets levelling off, with the yellow metal on course for the biggest monthly rise since August 2017. Money managers are bullish on gold for the New Year too.

Analysts say the precious metal is a beneficiary of the selloff that has engulfed global equities after US shares dropped sharply on Monday pulling Asian bourses down on the Christmas Day.

Investors' risk appetite has plummeted amid signs of more Washington dysfunction, reports say. There are many matters worrying the Street including President Donald Trump's attack on the Federal Reserve, and the partial shutdown over the budget.

"Overall the latest move on gold should be a stark reminder to investors that gold in any form should be an essential part of any long-term investment strategy, as again the yellow metal has proven its weight when markets turn turbulent," Mint quoted Stephen Innes, head of Asia Pacific trading at Oanda Corp, as saying.

It is early spring for holdings in gold-backed exchange-traded funds as investors are looking for havens and pricing in expectations for fewer US interest rate rises in 2019. The total trade volume hit 2,187.2 tonnes on December 25, up more than 100 tonnes since mid-October, estimates show.

"This Christmas season, we have massive volatility in US stocks and the Nikkei sank into a technical bear market," Huatai Futures Co.'s Xu Wenyu said in a report. "The US government shutdown has added to the market's list of worries."

Nine of 15 federal departments and dozens of government agencies shut down after Trump refused to sign a spending bill that did not include money for a wall along the southern border with Mexico. Congress has left Washington for the holidays, delaying any possible talks to end the shutdown.