Gold climbs towards 7-week high as dollar, equities slide

SINGAPORE (Reuters) - Gold edged towards a seven-week high on Thursday as a plunge in global equities and sell-off in the dollar burnished the metal's safe-haven appeal.

FUNDAMENTALS

* Spot gold had risen 0.2 percent to $1,229.30 an ounce by 0034 GMT, not far from a seven-week high of $1,238.20 reached earlier this week.

* U.S. and European equity markets fell on Wednesday as investors, worried about the Greek and Chinese economies, withdrew from riskier positions.

* Weak Chinese economic data dragged on appetite for stocks, along with Greece's decision to bring forward a presidential vote that heightened uncertainty over the country's transition out of its IMF/EU bailout.

* The dollar index fell for a fourth session in a row on Thursday.

* Gold is seen as an alternative investment to riskier assets such as equities. Weakness in the greenback also makes dollar-denominated bullion more attractive.

* An improvement in sentiment was seen in the holdings of SPDR Gold Trust, the world's largest gold-backed exchange-traded fund. The fund saw inflows of nearly 3 tonnes on Wednesday, brining total holdings to 724.80 tonnes.

* That was the fund's second straight day of inflows after holdings fell to six-year lows earlier this month.

* Investors were also keeping a close eye on oil prices, which were near five-year lows. Gold tends to fall in tandem with oil as weaker energy prices dull the metal's appeal as a hedge against oil-led inflation.

(Reporting by A. Ananthalakshmi; Editing by Joseph Radford)