PRECIOUS-Gold gains as risk sentiment wanes ahead of U.S.-China talks

* China-U.S. trade talks on Oct. 10-11
* FOMC minutes due at 1800 GMT Wednesday

(Updates prices, adds comments and detail)
By Sumita Layek
Oct 8 (Reuters) - Gold rose on Tuesday, shaking off losses
from earlier in the session, while the dollar eased and European
stocks fell ahead of minutes from the U.S. Federal Reserve and
trade talks between Washington and Beijing.
Spot gold XAU= rose 0.7% to $1,503.34 per ounce as of 1114
GMT. Prices had dropped as much as 1% in the previous session.
U.S. gold futures GCcv1 were up 0.3% at $1,509.10.
"The stock market is increasing losses, so gold is taking
back the safe haven role," ActivTrades chief analyst Carlo
Alberto De Casa said, adding, "The markets are also fearing the
trade talks and what's going on with Brexit."
Global stocks fell after China said it would take measures
to protect its sovereign security following Washington's move to
blacklist Chinese companies, and as disappointing European
earnings doused investors' optimism. MKTS/GLOB
In a setback for prospects of an orderly Brexit, a British
source said that German Chancellor Angela Merkel told Prime
Minister Boris Johnson by phone that a deal was "overwhelmingly
unlikely" unless Britain left its province of Northern Ireland
in Europe's customs union. The European Union then accused
Britain of playing "a stupid blame game".
"Gold seems to be relatively stable at the moment and that
has a lot to do with the fact we are in a fragile risk
environment," said OANDA senior market analyst Craig Erlam.
Chinese Vice Premier Liu He and U.S. Trade Representative
Robert Lighthizer are set to resume top-level trade talks on
Thursday, ahead of a scheduled increase in U.S. tariffs on $250
billion worth of Chinese goods on Oct. 15.
"If we do see a full collapse (in trade talks) unexpectedly,
that will lead to a lot of risk aversion which could be the
bullish catalyst gold needs," Erlam said, adding there was a lot
of uncertainty over the Fed minutes as well.
Investors are also awaiting the U.S. Federal Open Market
Committee's minutes from its September meeting on Wednesday for
clues on whether the central bank will cut rates at its October
session.
Lower interest rates tend to increase investor interest in
non-yielding gold.
Gold also drew support from the dollar, with the dollar
index .DXY shedding overnight gains against rivals.
"Gold ETFs (exchange-traded fund) are close to the highest
in years, so there definitely is demand for gold because of
trade tensions and the slowdown in general in global growth
rates," said SP Angel analyst Sergey Raevskiy.
Holdings of the world's largest gold-backed ETF, SPDR Gold
Shares GLD , held close to their highest in nearly three years
at about 923.76 tonnes. GOL/ETF
Among other precious metals, silver XAG= gained 0.4% to
$17.50 an ounce, while platinum XPT= rose 0.7% to $882.86 and
palladium XPD= fell 0.9% to $1,645.47.