May 25 (Reuters) - Gold dipped on Monday as Japanese equities rose on news about a potential stimulus programme, although losses were capped by a weaker dollar and worries of fresh Sino-U.S. tensions over Hong Kong.
FUNDAMENTALS
* Spot gold XAU= fell 0.3% to $1,729.17 per ounce by 1241 GMT. U.S. gold futures GCv1 were down 0.4% to $1,728.40.
* Japan is considering fresh stimulus worth over $929 billion, that mostly consist of financial aid programmes for companies hit by the coronavirus pandemic, the Nikkei newspaper said. Japan's Nikkei .N225 has jumped 1.5% following the report. MSCI's broadest index of Asia-Pacific shares outside Japan .MIAPJ0000PUS rose 0.1%. MKTS/GLOB
* The dollar index .DXY was down 0.1%, making greenback-denominated gold cheaper for investors holding other currencies.
* China dropped its annual growth target for the first time on Friday and pledged more government spending, setting a sombre tone to this year's meeting of parliament. Highlighting a return of political uncertainty, thousands rallied on Sunday to protest against Beijing's plan to impose national security laws on Hong Kong. China's proposed national security legislation for Hong Kong could lead to U.S. sanctions and threaten the city's status as a financial hub, White House National Security Adviser Robert O'Brien said on Sunday. SPDR Gold Trust GLD holdings, the world's largest gold-backed exchange-traded fund, rose 0.4% to 1,116.71 tonnes on Friday. GOL/ETF
* Palladium XPD= gained 1.3% to $1,970.25 per ounce, while platinum XPT= was down 1.1% to $830.75 and silver XAG= fell 0.4% to $17.12.
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