* Bullion has fallen in five out of past six sessions
* Silver, platinum and palladium prices firm up
(Updates prices; adds comment, second byline, NEW YORK
dateline)
By Marcy Nicholson and Clara Denina
NEW YORK/LONDON, May 10 (Reuters) - Gold fell to a near
two-week low on Tuesday, after its steepest loss since March in
the prior session, as a firm dollar and higher equities curbed
appetite for the precious metal.
Bullion turned quietly positive in late-day dealings after
falling in five out of the past six sessions, failing to fully
benefit from data last week showing that the U.S. economy added
the fewest jobs in seven months in April.
Spot gold XAU= was up 0.3 percent at $1,267.30 an ounce by
3:03 p.m. EDT (1903 GMT), after hitting an early low of
$1,257.25, its weakest since April 28.
U.S. gold for June delivery GCcv1 settled down 0.1 percent
at $1,264.80 an ounce.
Spot prices rose as much as 23 percent this year and are
still up 19 percent in 2016 so far as expectations for a
near-term increase in U.S. interest rates ease. Higher rates
would bolster the dollar, while lifting the opportunity cost of
holding gold.
"The drivers that have lifted gold prices still remain
largely intact, including the continuous wavering of the Fed in
terms of the rate increases and the softening of the dollar,
which introduced a layer of uncertainty in investors' mind sets
that tends to support the precious metal," said Nitesh Shah, ETF
Securities director of commodity research.
The dollar index .DXY was up 0.2 percent, having hit its
highest in nearly two weeks in the Asian trading session and
extending its rise from a 15-month trough struck on May 3.
World stock markets rallied as oil prices climbed and
companies reported solid earnings, while the yen again retreated
against the dollar. MKTS/GLOB
"Investors are in a slight risk-on mode right now and it's
leaning on gold a bit," said James Steel, chief metals analyst
for HSBC Securities in New York.
"Gold is still correcting but the pace of decline appears to
be moderating."
Gold, which reached a 15-month high of $1,303.60 last week,
will find the $1,300 level a tough barrier, as the investment
seen so far this year is unlikely to be replicated when physical
demand is so poor, ICBC Standard Bank analyst Tom Kendall said.
On the physical market, Indians bought a third less gold
than last year during the annual Hindu and Jain holy festival of
Akshaya Tritiya on Monday, industry officials estimate.
Silver XAG= rose 0.7 percent to $17.12 an ounce, platinum
was up 1.2 percent at $1,050.50 and palladium gained 1.6 percent
to $592.75.