Gold traded flat on Wednesday, as improving risk appetite and concerns that recent gains were overdone, offset a rise in ETF holdings. "Risk appetite seems to be coming back to the market," said Eugen Weinberg, a commodity analyst at Commerzbank. "The market was supported by investment inflows, but right now there are not so many arguments for higher prices in the short-term." "In the long term, we are looking for more inflationary pressure, more demand from investors," he added. The world's largest gold-backed exchange-traded fund, SPDR Gold Trust, said its holdings rose to 1 294.604 tonnes by August 17 from 1 286.699 tonnes on August 12. Bullion prices touched $1 228.45 on Tuesday, the highest since early July. It was about 3 percent below a record struck in June. PRICES * Spot gold was at $1 223.95 at 08:59 SA time compared with $1 222.90 late in New York on Tuesday. * Silver was at $18.50 from $18.47. * Platinum at $1 539.50 from $1 538.50. * Palladium at $494.35 from $493.50. DATA/EVENTS * Bank of England publishes meeting minutes at 10:30 SA time. * Weekly US mortgage market index at 13:00 SA time. MARKET NEWS * Asian stocks rose and the dollar inched up against the yen as a $39 billion takeover bid in the farm sector and earnings from two US retail giants boosted confidence in the corporate outlook. * The yen rose, with traders citing yen buying by Japanese players, while the Canadian dollar held gains made on news of a takeover bid by global miner BHP Billiton for Canada's Potash Corp. * Oil prices fell after an industry report signalled petroleum inventories in top consumer the United States were headed for a record, following an unexpected sharp increase in crude stocks last week. * US stocks rose on Tuesday after earnings from Wal-Mart and Home Depot and a $39 billion takeover bid in the agriculture sector bolstered confidence in the corporate outlook. FUNDAMENTALS * China, the world's second-largest gold consumer, produced 31.897 tonnes of the precious metal in June, up from 28.31 tonnes in May, the Ministry of Industry and Information Technology said on Wednesday. * Kazakh miner ENRC posted a 63 percent rise in first-half earnings per share on higher output and prices, but was wary about commodity prices in the second half. * Latin American precious metals miner Hochschild said pretax profit tripled in the first half on higher silver and gold prices. * Two questionable mining deals and two proposed measures to curb the media have posed a question mark about how South African President Jacob Zuma's government has been running the country. * Global miner BHP Billiton may go hostile with its $39 billion bid for fertiliser group Potash Corp as early as Wednesday, a source said, setting the stage for a possible higher offer. TECHNICALS * Gold support at $1 210, resistance at $1 230, RSI 14 at 73.7. * Silver support $18.10, resistance $18.72, RSI 14 at 64.2. * Platinum support $1 517, resistance $1 555, RSI 14 at 49.7. - Reuters

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