* Dollar slides to 6-week low vs euro, currency basket
* Firmer equity markets boost appetite for risk
(Updates throughout, changes dateline-pvs TOKYO)
By Jan Harvey
LONDON, July 20 (Reuters) - Gold rose more than 1 percent in Europe on Monday as the dollar slipped to a six-week low against a basket of currencies, boosting the precious metal's appeal as a currency hedge, and as oil prices climbed.
Commodities across the board benefited from a sharper appetite for risk, dealers said, with equities touching a ten-month high in Asia as a solid outlook for corporate earnings tempted investors back into higher-yielding assets.
Spot gold <XAU=> rose to a five-week high of $951.30, its firmest since June 12, and was bid at $950.30 an ounce at 0924 GMT, against $936.50 an ounce late in New York on Friday.
"There is a combination of both a weaker dollar (and) appetite for commodities coming back with the hope of an economic recovery," said Alexander Zumpfe, a trader at precious metals house Heraeus.
"From a pure technical point of view, we might see some higher prices over the next couple of days."
The dollar slid to a six-week low against the euro <EUR=> and versus a basket of six major currencies <.DXY> as rising stock markets boosted appetite for higher-yielding currencies seen as riskier. [
]Other commodities also benefited from stronger risk appetite, with oil climbing nearly $1 a barrel and copper rising to its highest level since October. [
] [ ]Equities hit a ten-month peak in Asia as investors' confidence was boosted by a solid outlook for corporate earnings and speculation that U.S. lender CIT Group <CIT.N> has probably escaped bankruptcy after news it clinched a last-minute $3 billion rescue deal. [
]Banks and drugmakers also helped lift European shares. [
]Traders are awaiting earnings reports from the likes of Texas Instruments <TXN.N>, Caterpillar <CAT.N> and Merck & Co <MRK.N> this week, as well as Federal Reserve chair Ben Bernanke's testimony to Congress on monetary policy on Tuesday and Wednesday.
BREAK HIGHER
Analysts say the euro's break up through $1.42 may fuel further gains in the gold price. Bullion, like all dollar-priced commodities, becomes cheaper for holders of other currencies as the U.S. unit weakens.
Demand for physical gold remained lacklustre, with the main bullion-backed exchange-traded fund, the SPDR Gold Trust, reporting a 0.31-tonne outflow on Friday. The fund said its gold holdings dropped more than 15 tonnes last week. [
]Jewellery demand in India was also soft, pressured by the seasonal summer lull. [
]On the supply side, Peter Hambro Mining <POG.L>, the Russia-focused FTSE 250 gold miner, said its gold output jumped 54 percent in the first half and said second-half production will be boosted by its Pioneer deposit. [
]Among other precious metals, silver <XAG=> tracked gold higher, rising more than 2 percent to $13.70 an ounce from $13.39.
"We still see more consolidation around these levels after the ongoing rally exhausts itself," said VTB Capital in a note.
Platinum <XPT=> was at $1,179.50 an ounce against $1,171, while palladium <XPD=> was at $249.50 against $246.
(Reporting by Jan Harvey; Editing by Keiron Henderson)