* Spot gold lower at $870.80 an ounce * London Brent crude lower at $39.36 a barrel LCOc1 * Rupee weaker at 48.60 per dollar * U.S. weekly jobless claims at 1330 GMT [MI/DIARY] MUMBAI, Dec 31 (Reuters) - India's gold reversed early losses to trade slightly higher on Wednesday buoyed by a weaker rupee and a recovery of the global futures market, but domestic demand was weak as traders stayed on the sidelines. Retail consumers thronged shops to sell old gold ornaments as prices moved above 13,500 rupees per 10 grams, seeking to recycle their jewellery, limiting demand for new bars. See [ID:nBOM387852] "We are relaxing right now...," said Daman Prakash, director at MNC Bullion Pvt Ltd, a Chennai-based wholesale gold trader, referring to the inactivity at his business. There is no buying interest despite of a 2-3 percent discount on international gold prices, he added. COMEX gold for February delivery GCG9 trimmed early losses as a stronger euro spurred buying. On the Multi Commodity Exchange, February gold MAUG9 last traded 5 rupees higher at 13,447 rupees per 10 grams. Demand is expected to remain weak at least in the near-term unless prices correct, said Natwarlal Choksi, owner of Choksi Vachhraj Makanji & Co., a Gujarat-based wholesale trader. Following were the prices being quoted by HDFC Bank in rupees in the spot market at 1:15 p.m. INBULL03: Wednesday Tuesday ================================================ Gold .999/10 grams 13,720 13,728 Silver .999/kg 18,241 17,913 Following were prices in rupees on the Multi Commodity Exchange of India Ltd. at 3:09 p.m. <0#MAU:>: Contract Current price Net change ====================================================== Feb gold 13,450 +8 Mar silver 17,958 -44

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