* Dealers see downside gold price risk
* Coming up: FOMC policy decision, 1815 GMT
* Dealers eye seasonal Indian demand before Diwali
(Adds trade comment, background, updates prices)
LONDON, Oct 24 (Reuters) - Gold rose on Wednesday along with stock markets, helped by well received data from China and an upbeat earnings report from Boeing, while dealers awaited a Federal Reserve policy statement later in the day.
The dollar index erased gains against a basket of currencies, relieving early pressure on gold.
Spot gold was up 0.1 percent at $1,709.60 an ounce at 1309 GMT, while U.S. gold futures for December delivery were up 60 cents an ounce at $1,710.
A Chinese survey of purchasing managers on Wednesday pointed to a modest recovery in October for the world's second-largest economy from the growth slowdown seen during the third quarter.
Pressure from falling stocks and a firmer dollar pushed gold prices to a seven-week low of $1,703.50 on Tuesday. It is still on track to decline in October for the first month in five.
Gold hit a 2012 high on Oct. 5 at $1,795.69 after the Federal Reserve unveiled a third round of quantitative easing measures to stimulate growth but lost momentum after failing to break the psychologically important $1,800 an ounce level.
It has come under pressure this week from a raft of disappointing corporate earnings statements.
``In the short term, the price risk is biased to the downside. There is a risk that corporate earnings reports are perceived with disappointment,'' said Peter Fertig, consultant with Quantitative Commodity Research, referring to several recent disappointing bellwether results.
``Weakness in stock markets is being translated into precious metals markets. A major support level is coming in around the $1,685 area,'' Fertig added.
On Wednesday Boeing Co posted stronger-than-expected earnings for the third quarter and raised its forecast for the full year. U.S. stocks opened higher after the Dow suffered its biggest drop in four months the previous day on weak results from DuPont and United Technologies.
Investors awaited the outcome on Wednesday of a two-day Federal Reserve meeting in Washington. While the Fed is not expected to add to last month's stimulus pledge, its comments will be closely watched for clues on policy direction.
Another focus was the potential impact of the Nov. 6 U.S. presidential election, with some seeing a Mitt Romney victory as signalling an earlier exit from the Fed's money-printing strategy and a lower gold price.
Dealers also sought to assess the level of demand for gold from top consumer India, particularly during its festival season which peaks with Diwali next month. A strengthening rupee could lead to a pick-up in gold demand after a subdued year so far.
``In a weak economy, the weak rupee had dampened demand,'' Natixis analyst Nic Brown said.
SUPPORT SEEN
From a technical perspective, analysts who study past price patterns for clues on the next direction of trade flag up support at the psychological level of $1,700 an ounce.
``The next level of support after that is $1,660 an ounce, which coincides with gold prices before Fed Chairmen Ben Bernanke's speech on economic policy at a Jackson Hole, Wyoming, summit on 31 August,'' HSBC said in a note.
``We continue to see modest pressure on gold prices in the near term, barring any surprise announcements by the FOMC for additional monetary easing policies.''
In South Africa, which has been hit by a wave of violence linked to labour unrest this year, AngloGold Ashanti said it would sack 12,000 wildcat strikers who ignored a deadline to return to work.
It was only the latest company to resort to mass firings. Gold Fields said late on Tuesday it had sacked 8,500 wildcat strikers after they ignored an ultimatum to return to work or face dismissal.
Silver was up 0.7 percent at $31.84 an ounce, while spot platinum was up 0.4 percent at $1,574.75 an ounce and palladium was up 0.9 percent at $596.47 an ounce.
Palladium outperformed platinum after falling nearly 5 percent on Tuesday, posting its biggest one-day price drop since March, though it remained near two-month lows.
(Editing by Jane Baird)