Gold held above $1 060 (R7 759) an ounce in Europe on Tuesday as persistent weakness in the dollar fuelled buying of the precious metals as an alternative asset. Platinum and palladium reached their highest in more than a year, buoyed by gold and supply concerns. Spot gold was bid at $1 061.20 an ounce at 11:06 SA time against $1 062.70 late in New York on Monday. US gold futures for December delivery on the COMEX division of the New York Mercantile Exchange rose $3.90 to $1 062.00 an ounce. Standard Bank analyst Walter de Wet said given the dearth of physical demand for bullion, gold was primarily driven by the dollar, which in turn was in thrall to sentiment on the equity markets as earnings season advances. "(The rise of gold) is a dollar story at this stage, because in terms of real physical demand, there is not much," he said. "We are waiting for a whole bunch of earnings reports to come into the market, and if the past week's reports are anything to go by, these ones will also be positive," he added. "If you see equities rising and US Treasuries being sold, dollars will also be sold, which will make the dollar weaker." World stocks hit a new 12-month high on Tuesday, fuelled by optimism over corporate earnings and the global recovery after strong results from US heavyweights Apple and Texas Instruments. The dollar is under pressure from rising risk appetite -- which benefits higher-yielding currencies --, expectations low US interest rates will be sustained and questions about its status as the global reserve currency. The US unit slid to fresh 14-month lows against the euro, with the single currency rising close to $1.50.

Source