SINGAPORE, June 11 (Reuters) - Gold rebounded on short covering on Friday after falling around 1 percent in the previous session, while a rise in ETF holdings to another record showed bullion still attracted buying from investors. But gold was still at the mercy of movements in equity and currency markets, with rallies in shares likely to curb gains.

Gold hit a lifetime high $1,251.20 earlier this week on fears the euro zone's sovereign debt crisis may spread. Spot gold XAU= was at $1,219.50 an ounce by 0216 GMT, up $3.70 from New York's notional close on Thursday, when it slipped after a rally in Wall Street curbed safe-haven demand.

I don't really see gold depreciating very soon to a great extend, said Darren Heathcote, head of trading at Investec Australia in Sydney. But I do think it wouldn't surprise me to see it ease back a little more if we see another couple of days of positive news in the stock market, he added.

U.S. gold futures for August delivery GCQ0 hardly changed at $1,221.7 an ounce after a drop on Thursday as gains in the euro eased fears about euro zone credit contagion. The world's largest gold-backed exchange-traded fund, SPDR Gold Trust (GLD.P), said its holdings rose to a lifetime high at 1,306.137 tonnes as of June 10. [GOL/SPDR]

Japan's benchmark Nikkei average .N225 rose 2.01 percent to 9,734.33 on Friday after U.S. stocks posted their best day in the last nine on Thursday in response to signs of health in the euro debt market. [.T] [.N]

 It's too difficult to say with any certainty that the market will go one way or the other, but certainly I would like to think that we are going to get a period of stability and probably see gold ease back a little bit, said Heathcote. If it did, we'll probably be targeting somewhere down around the $1,175 area, said Heathcote, referring to a low seen in May.

The euro's short-covering rally paused above $1.2100 on Friday, with the single currency squaring up to testsignificant bands of resistance, and the Australian dollar held strong gains as firmer share markets improved risk tolerance.

[USD/]

Investors also breathed a sigh of relief after European Central Bank President Jean-Claude Trichet said three-month emergency loans to banks would continue until September and when Germany's high court rejected efforts to block German guarantees for euro zone financial aid. 

There's a bit of bargain hunting but I think if we see more rebound in stocks, then gold will drift down, said a

dealer in Hong Kong. I don't think there's buying from jewellers. People are also waiting for more clues, whether the euro will continue to stabilise.

U.S. crude futures stood steady on Friday after closing at a four-week high above $75 a barrel a day earlier on the back of a Wall Street rally and a rosier oil demand forecast by International Energy Agency. [O/R]

Precious metals prices at 0216 GMT

Metal             Last    Change  Pct chg  YTD pct chg

Turnover

Spot Gold        1219.50    3.70   +0.30     11.30

Spot Silver        18.29    0.10   +0.55      8.67

Spot Platinum    1544.50   10.50   +0.68      5.28

Spot Palladium    454.75    4.25   +0.94     12.15

TOCOM Gold       3600.00   -3.00   -0.08     10.46

26682

TOCOM Platinum   4587.00   82.00   +1.82      4.70

9107

TOCOM Silver       54.30    0.60   +1.12      5.03

210

TOCOM Palladium  1350.00   23.00   +1.73     15.88

87

Euro/Dollar       1.2102

Dollar/Yen         91.57

TOCOM prices in yen per gram. Spot prices in $ per ounce.

(Editing by Himani Sarkar)