PRECIOUS-Gold holds near 1-month peak as dollar, stock markets soften – Nasdaq

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* Chinese, London and U.S. markets closed for holiday
    * Trump refuses to back climate change accord at G7 meeting
    * Palladium prices edge back above $800/oz
    * GRAPHIC-2017 asset returns:

 (Updates prices)
    By Jan HarveyLONDON, May 29 (Reuters) - Gold held near its highest in a
month on Monday in holiday-thinned trade, with a softer dollar
and a retreat in stock markets helping the metal cling on to the
previous session's gains.
    Gold hit its highest since May 1 on Friday at $1,269.50 an
ounce, as nervousness over U.S. President Donald Trump's
negotiations with other world leaders at the G7 summit prompted
investors to buy bullion as an alternative to nominally
higher-risk assets such as shares.
    Spot gold <XAU=> was at $1,266.30 an ounce at 1340 GMT,
little changed from $1,266.66 late on Friday. U.S. gold futures
<GCv1> for June delivery down 0.2 percent at $1,265.20.
    A 0.1 percent retreat in the dollar index underpinned
prices, but moves were muted, with traders in the United States,
London and China all out for national holidays.
    "Potential for prices is limited right now, but with the
news from the G7 meeting and the weaker dollar, the gold price
has gone up," said LBBW analyst Thorsten Proettel.
    Pointing to bruising meetings of Group of Seven nations and
NATO last week, German Chancellor Angela Merkel said on Sunday
Europe can no longer completely rely on its allies. [nL8N1IU0EO]
    Under pressure from the G7, Trump on Saturday backed a
pledge to fight protectionism but refused to endorse a global
accord on climate change, saying he needed more time to decide.
    The market is also awaiting next month's Federal Open Market
Committee meeting for any clues on the U.S. Federal Reserve's
stance on interest rate increases.
    Gold is highly sensitive to rising U.S. rates, which
increase the opportunity cost of holding non-yielding bullion,
while boosting the dollar, in which it is priced.
    "Market participants will presumably be casting an eye over
the labour market report in the U.S. this week," Commerzbank
said in a note. "If the data turn out to be positive, there is
probably nothing to prevent the (Fed) implementing its next rate
hike in mid-June."
     Hedge funds and other money managers increased their net
long position in COMEX gold for the first time in four weeks in
the week to May 23, U.S. Commodity Futures Trading Commission
data showed. [nL1N1IS1B6]
    Concerns over Italy's banks and Britain's national election
campaign dominated European financial markets on Monday,
prodding stock markets lower in muted trade. [MKTS/GLOB]
    In other precious metals, silver <XAG=> was up 0.2 percent
at $17.38 an ounce, having touched a one-month high of $17.41.
    Platinum <XPT=> was 0.3 percent lower at $953 while
palladium was up 1.1 percent at $799, after hitting a near
two-week peak of $800.90 early in the session.

GRAPHIC-2017 asset returns
 (Additional reporting by Vijaykumar Vedala in Bengaluru;
Editing by David Goodman and David Evans)
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