* U.S. and China say they are willing to negotiate on tariffs
* Rising global stocks, stronger dollar dampen gold demand
* China markets closed on Thursday and Friday
(New throughout, updates prices, market activity and comments; adds second byline and NEW YORK dateline) NEW YORK/LONDON, April 5 (Reuters) - Gold prices dropped on Thursday as safe-haven demand eased for bullion after the United States and China signaled willingness to negotiate a trade dispute instead of hitting each other with tariffs that might slow economic activity in both countries. Investors put money back into equities, sending global stock markets higher, while the dollar strengthened, making gold more expensive for users of other currencies. "Trade tensions have moderated overnight a little bit and equities are higher, and that puts pressures on the precious metals," said Chris Gaffney, president of world markets at Everbank. The slide in gold prices created a negative technical picture that encouraged further selling, FOREX.com's Fawad Razaqzada added.
Spot gold declined 0.5 percent at $1,325.81 by 1:38 p.m. EDT (1738
GMT). During the session, gold hit a one-week low of $1,322.40.
U.S. gold futures for June delivery settled down $11.70, or 0.9
percent, at $1,328.50 per ounce. On Wednesday, gold had surged to $1,348.06 after Beijing threatened to retaliate against proposed U.S. tariffs on Chinese imports worth around $50 billion with its own duties on U.S. products including soybeans, planes, cars, whiskey and chemicals. Both Washington and Beijing later said they were willing to negotiate a resolution. President Donald Trump's top economic adviser called the announcements by the two countries mere opening proposals and suggested the U.S. tariffs may never go into effect, while China's ambassador in Washington said Beijing's preference was to resolve the dispute through talks. "That $1,350-$1,360 has been a pretty stubborn resistance level and there hasnt been enough of a catalyst to push it through there, said Tyler Richey, co-editor of the Sevens Report. Investors were looking to U.S. jobs data on Friday for new direction on prices. Strong employment and wage growth would encourage the U.S. Federal Reserve to raise U.S. interest rates more aggressively and push gold prices lower. Gold is sensitive to rising rates because they push up bond yields, reducing the attractiveness of non-yielding bullion, and tend to boost the dollar, in which gold is priced. Trading volumes were likely to be lower however with markets in mainland China, the world's largest gold consumer, closed on Thursday and Friday for the Tomb Sweeping Day holiday.
Meanwhile, spot silver increased 0.4 percent at $16.35 an ounce
earlier hitting $16.17, a two-week low.
Platinum lost 0.4 percent at $908.50 an ounce after touching $901.50,
its lowest since December.
Palladium dropped 2.3 percent at $903 an ounce after hitting a new
6-1/2-month low at $899.50.
(Additional reporting by Swati Verma in Bengaluru; editing by David Gregorio and David Stamp)