* SPDR Gold holdings fall to lowest since March 8
* Silver off 3-month lows hit on Tuesday
* GRAPHIC-2019 asset returns: (Updates prices)By Sumita LayekApril 3 (Reuters) - Gold steadied on Wednesday, supported bya dip in the dollar, while gains were capped by a rally inglobal stocks following reassuring economic data from the UnitedStates and China and optimism the two countries would strike atrade deal.Spot gold was unchanged at $1,292.78 per ounce at1155 GMT, having touched its lowest level since March 7 at$1,284.76 in the previous session. U.S. gold futures wereup 0.2 percent at $1,297.60 an ounce."Investors are moving into racier equity markets rather thanslower moving precious markets," said Fawad Razaqzada, marketanalyst with Forex.com
However, he said that fundamental factors would likelycontinue to underpin gold, even if equity markets continued torally.
"With the U.S. Federal Reserve being dovish, the dollarbeing low, and yields being lower, the fundamental environmentfor gold itself is positive."Signs of progress in U.S.-China trade talks this week anddecent factory activity data from both countries in recent dayshas lifted investor sentiment and taken the edge off globalrecession fears.The dollar, which was sought as a safe-haven in preferenceto gold last year against a backdrop of the unfolding trade war,was down 0.3 percent against a basket of currencies on Wednesday , making bullion cheaper for holders of other currencies. ActivTrades chief analyst Carlo Alberto De Casa said in anote that a return to the psychological threshold of $1,300would be a positive signal for gold, while a fall below $1,280could open the way for a further decline to $1,260. He said hesaw the latter scenario as the least likely for the time being.
Investors are now waiting for clues on the strength of theU.S. economy from non-farm payrolls data due on Friday.Meanwhile, British Prime Minister Theresa May will meetopposition leader Jeremy Corbyn to thrash out a Brexitcompromise, a gamble that could finally see a European Uniondivorce deal agreed but also tear her party apart. Indicative of investor sentiment toward bullion, holdings inthe world's largest gold-backed exchange-traded fund, SPDR GoldTrust , fell to their lowest since March 8 at 768.10 tonneson Tuesday. Among other precious metals, silver was up 0.1percent at $15.12 per ounce, having touched its lowest levelsince late December at $14.90 on Tuesday.
"The fact that there was no willingness from the sellers tohold the ground below $15 suggest to me that demand hasoutweighed supply and ... we could see prices start to climbhigher from here," Forex.com's Razaqzada said.
Spot palladium was up 0.1 percent at $1,429.73 anounce, while platinum rose 2 percent to $862.92 an ounce. (Reporting by Sumita Layek in Bengaluru, editing by LouiseHeavens and Kirsten Donovan)
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