BLBG: Gold Advances on Haven Buying as Equities, Commodities Tumble
By Feiwen Rong
Oct. 7 (Bloomberg) -- Gold climbed for a second day on increased demand for a haven as the credit crisis deepened in Europe and equities and commodities tumbled worldwide.
Global shares plunged yesterday, erasing more than $2 trillion in market value, and crude oil dropped below $90 a barrel for the first time since February. Gold gained 2.9 percent after tumbling 4.9 percent last week as the U.S. passed a $700 billion package to bail out banks.
Gold ``benefited from safe haven flow'' amid ``increasing pessimism over the international economic outlook'', David Moore, commodity strategist at Commonwealth Bank of Australia in Sydney, said in a report today.
Bullion for immediate delivery advanced 0.8 percent to $866.17 an ounce at 9:13 a.m. in Singapore. Silver for immediate delivery gained 1.1 percent to $11.1650 an ounce.
Asian stocks slumped for the fourth day on concern the seizure in credit markets will deepen a global recession.
Equities in the U.K. fell the most since 1987 yesterday, while the Dow Jones Industrial Average plunged below 10,000 for the first time in four years. Bank of America Corp. and Citigroup Inc. sank more than 5 percent after the German government led a bailout of Hypo Real Estate Holding AG and BNP Paribas SA bought parts of Belgium's Fortis.
A measure of six metals traded on the London Metal Exchange slumped 5.8 percent, the steepest decline since Aug. 16, 2007. Zinc fell 2.9 percent, copper 7.5 percent and nickel 5.6 percent.
December-delivery gold was little changed today at $866.70 an ounce in after-hours electronic trading on the Comex division of the New York Mercantile Exchange.
Gold for August delivery advanced 2 percent to 2,799 yen a gram ($856 an ounce) on the Tokyo Commodity Exchange at 9:46 a.m. local time.
To contact the reporter on this story: Feiwen Rong in Singapore at firstname.lastname@example.org