MANILA, Jan 21 (Reuters) - Gold dropped early on Thursday in Asia, slipping from a 1-1/2-week high, as battered stocks bounced back along with U.S. crude.
FUNDAMENTALS
* Spot gold XAU= was off 0.2 percent at $1,099.40 an ounce by 0039 GMT, after touching $1,109.20 on Wednesday, its highest since Jan. 8.
* U.S. gold for February delivery GCcv1 slipped 0.6 percent to $1,099.60 an ounce.
* Bullion has benefited from the risk-averse sentiment that has dragged equities and oil to multi-year lows and pushed investors towards assets deemed as safe havens.
* Still, the metal has found resistance around $1,100 as the threat of further U.S. interest rate increases and a stronger U.S. dollar suggest limited upside potential.
* But expectations of another U.S. interest rate hike in March diminished after consumer prices unexpectedly fell in December as the cost of energy products and food declined, offering signs of weak inflation. SPDR Gold Trust GLD , the world's largest gold-backed exchange-traded fund, said its holdings rose to 660.30 tonnes on Wednesday from 657.92 tonnes on Tuesday. GOL/ETF
* Johnson Matthey (L:JMAT) has lifted its estimate of last year's platinum market deficit after a surge in Japanese bar investment late in the year, though it cut its expectations for the palladium market shortfall. For the top stories on metals and other news, click TOP/MTL or GOL
MARKET NEWS
* Asian shares and the dollar edged higher, but investors remained cautious as another shakeout on Wall Street and oil prices suggested volatility in financial markets will continue to temper risk appetite. MKTS/GLOB
* U.S. crude oil stabilised after hitting fresh 2003 lows the session before, but analysts said a persistent global glut would keep pressuring prices. O/R
DATA/EVENTS AHEAD (GMT)
0745 France
Business climate
Jan
1245 European Central Bank releases policy meeting outcome
1330 ECB President Mario Draghi holds news conference
1330 U.S.
Weekly jobless claims
1330 U.S.
Philly Fed business index
Jan
1500 Euro zone
Consumer confidence
Jan