By Lewa Pardomuan SINGAPORE (Reuters) - Gold slipped to its lowest level in nearly a week on Tuesday as weaker equities prompted speculators to sell bullion to cover losses, but an expected drop in U.S. existing homes sales could spur a rebound. Lower prices attracted bargain hunters from Indonesia, Thailand and Hong Kong but volume was low. Silver, platinum and palladium were under pressure from weak bullion and declines in the Nikkei. Gold fell $2.90 an ounce to $1,220.50 by 0239 GMT after hitting a low of $1,219.30, its weakest since August 18. It jumped to a 1-½ month high at $1,237.15 last week after a trail of poor U.S. data knocked confidence in the economic recovery. For a graphic of the 24-hour gold technical outlook, click: here "I guess the market sentiment is not really too bad. The Indian festival is coming in and the funds will finish their holidays," said Ronald Leung, director of Lee Cheong Gold Dealers in Hong Kong. "We see some light buying when the price slips towards $1,220," said Leung, adding that uncertainty in the global economy would also underpin sentiment in gold. Demand in India, the world's largest gold consumer, rises during the festive season, which begins with Raksha Bandhan next week and lasts through November with Dhanteras -- the single-biggest gold buying day. U.S. gold futures for December delivery dropped $6.1 to $1,222.4 an ounce. Investors await the release of U.S. existing home sales, which are expected to show a drop of around 12 percent in July, underlining the weakness of the housing market. Lacklustre U.S. data could boost gold's safe-haven appeal in times of uncertainty. The Nikkei dropped below the closely watched 9,000-mark for the first time in 15 months on Tuesday after U.S. stocks weakened, with some analysts noting selling by hedge funds and foreigners due to mounting concerns over economic recovery. The euro was wrestled to multi-week lows in Asia as the loss of key technical support led speculators to short the currency in the hope of forcing stop-loss sales against both the yen and the dollar. In the physical sector, premiums for gold bars were steady at 80 cents to the spot London prices in Singapore, with dealers waiting for India to resume buying as prices dropped. "Bullion dealers and jewellers from Thailand and Indonesia are buyers. But we are also seeing light buying from other physical buyers in Thailand," said a dealer in Singapore, referring to purchases from investors. In the energy market, crude oil fell for a fifth day and gasoline component RBOB tumbled to a 6-½ month low, as the dollar strengthened and the lacklustre U.S. driving season approached its end without triggering a seasonal stockpile drop.

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