MANILA, Aug 25 (Reuters) - Gold steadied below a seven-week high early on Tuesday as the dollar regained some lost ground versus a basket of currencies while investors waited to see if there would be a second day sell-off in Chinese stocks.
FUNDAMENTALS
* Spot gold XAU= was off 0.1 percent at $1,153.56 an ounce by 0035 GMT. The precious metal closed lower on Monday after a five-day rally that lifted it to $1,168.40 on Friday, its loftiest since July 7.
* U.S. gold for December delivery GCcv1 was flat at $1,153.50 an ounce.
* Asian stocks looked vulnerable to another sell-off, with investors gripped by fears of a hard landing for the Chinese economy, the world's most important growth engine. MKTS/GLOB
* Japan's Nikkei .N225 index fell 3.8 percent to six-month lows while the MSCI's broadest index of Asia-Pacific shares outside Japan .MIAPJ0000PUS hit fresh three-year lows.
* That bodes well for gold, with increased uncertainty likely to lift investor appetite for safe-haven assets.
* Gold was among the least bruised by Monday's sell off, dropping half a percent versus a 6 percent slide in Brent crude LCOc1 and a 2 percent decline in copper CMCU3 .
* A near-9 percent dive in China shares sent world stocks and commodity prices tumbling on Monday.
* Atlanta Fed President Dennis Lockhart said that the Federal Reserve will likely begin raising rates "sometime this year," but that the steep drop in oil prices clouds the inflation outlook. Two weeks ago, Lockhart said he was "very disposed" to a rate hike in September. ID:nL1N10Z28W
* A dollar slump and a China-fuelled rout in equities and industrial commodities has propelled gold to seven-week highs, but bulls are still wary of a wholesale plunge into the market. ID:nL5N10Z38N
* Spot palladium XPD= extended losses, falling 2.1 percent to $558.75 an ounce, its lowest since July 2012.
* For the top stories on metals and other news, click TOP/MTL or GOL
MARKET NEWS
* The dollar rose 0.3 percent against a basket of major currencies .DXY after tumbling nearly percent on Monday in its deepest retreat since 2011. USD/
DATA AHEAD (GMT)
0600 Germany
Detailed GDP
Q2
0800 Germany
Ifo business climate
Aug
1300 U.S.
Monthly home price index
Jun
1300 U.S.
S&P/Case-Shiller housing index Jun
1345 U.S.
Markit services PMI flash
Aug
1400 U.S.
Consumer confidence
Aug
1400 U.S.
New home sales
Jul