Gold falls as dollar pares losses; platinum sinks on stocks rout

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Gold turned lower on Monday, as the dollar pared losses, and U.S. shares and other commodity markets staged a comeback while the white precious metals fell on concerns about the Chinese economy.

World stock markets initially plunged after a near-9 percent dive in China shares, attracting safe haven buying to gold as crude oil futures fell sharply to 6-1/2-year lows and copper to a six-year low.

Spot gold was down 0.7 percent at $1,152.45 an ounce, after rising to $1,167.50 an ounce. U.S. December gold futures settled down 0.5 percent at $1,153.60 an ounce.

Platinum dropped as much as 4.5 percent, palladium hit a three-year low at $563.72 an ounce and silver fell 4.8 percent to the lowest since Aug. 6 at $14.57 a ounce.

The 19-commodity Thomson Reuters CoreCommodity Index fell as much as 3.2 percent to the lowest level since December 2002 after slumping Chinese equities fueled worries of a hard landing in the world's biggest consumer of raw materials.

The U.S. dollar fell 2.5 percent to its lowest since the end of January before paring losses.

Gold has now rebounded 7 percent from a 5-1/2-year low of $1,077 reached in late July, benefiting from uncertainty posed by China's surprise devaluation of its yuan currency.

Worries about global deflation, however, would not bode well for gold, typically seen as a hedge against inflation.

Source: Bloomberg

Dollar Plunges to 7-Month Low Versus Euro, Yen Amid Global Rout

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The dollar slumped to a seven-month low against the euro and the yen as most traders concluded the Federal Reserve will refrain from raising interest rates next month amid a global stock-market rout.

The greenback fell to the lowest since January as declining commodity and share prices deepened a plunge in emerging-market currencies that started after China’s shock devaluation of the yuan on Aug. 11.

The dollar fell 2.4 percent to $1.1663 per euro at 9:23 a.m. in New York after falling as low as 1.1714, the weakest since Jan. 15. It dropped 3.8 percent to 117.44 yen after reaching 116.18, the lowest since Jan 16.

Source: Bloomberg

S&P 500 Index Falls Into Correction Amid Global Equities Rout

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The Standard & Poor’s 500 Index fell into a correction for the first time since 2011 in one of the most volatile trading days ever, as a rout in global equity markets deepened.

It was a day of wild swings as equities plunged at the open before staging a sharp rebound, with the Nasdaq 100 Index by midday nearly erasing a 9.8 percent drop. The Dow Jones Industrial Average dropped 1,000 points in the opening minutes of trading, and the S&P 500 tumbled 5.3 percent and then pared declines before an afternoon wave of selling.

The S&P 500 dropped 3.9 percent to 1,893.39 at 4 p.m. in New York, and was 11 percent below its May record.

The Chicago Board Options Exchange Volatility Index rose 44 percent to 40.42, trimming an earlier 90 percent surge that temporarily sent the index to its highest level since January 2009. The gauge known as the VIX more than doubled last week, soaring 118 percent to 28.03.

The S&P 500’s rout sent valuations tumbling. The price-to-earnings ratio for the gauge sank to 16.76, the lowest level since the October pullback. Then, the measure bottomed just above 16.50, the cheapest since January 2014.

Source : Bloomberg

European stocks lose more than 500 bln euros in value after China rout

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European stocks slumped on Monday following a rout in Chinese markets, wiping hundreds of billions of euros off leading shares and sending one benchmark index to a seven-month low.

Trading screens flashed red across the region as stock markets in Frankfurt and Paris fell more than 5 percent, while Athens' bourse - already down sharply due to Greece's debt problems - slumped around 10 percent.

The pan-European FTSEurofirst 300 was down 6.4 percent going into the close of the trading session, wiping off more than 500 billion euros ($582.55 billion) from the index's tota market capitalisation.

The FTSEurofirst was on course for its worst one-day percentage fall since it slumped more than 7 percent in October 2008, just after the demise of U.S. bank Lehman Brothers. It was also on course for its worst monthly loss since 2002.

It also sank to its lowest level since January, having lost more than a trillion euros in market value since the start of the month as China's devaluation of the yuan stoked fears of global economic deflation.

Chinese stocks plunged more than 8 percent on Monday, in their biggest one-day loss since the height of the global financial crisis in 2007, after Beijing held back expected policy support at the weekend following last week's 11 percent slide.

The STOXX 600 Basic Resources Index, whose constituents are mostly mining stocks, and the energy sector fell 10 percent and 8.8 percent respectively, as commodities slumped to multi-year lows, with China being one of the world's biggest users of metals and oil.

Shares in banks and asset managers also fell sharply, while the Euro STOXX Volatility Index rose 14 points to its highest level since late 2011 - more evidence of investor unease.

Source: MarketWatch

U.S. Stocks Slide Amid Deepening Rout in Global Equity Markets

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U.S. stocks fell, tracking a selloff in global equity markets, amid a deepening rout in all but the safest assets.

The Standard & Poor’s 500 Index slid 4.8 percent to 1,876.16 at 9:34 a.m. in New York, with the benchmark hitting its lowest level since October.

Calm in the U.S. market shattered last week, with volatility soaring by the most on record as the Dow entered a correction and investors dumped the biggest winners of 2015. A gauge of volatility expectations more than doubled last week. Shares succumbed to a global selloff that’s wiped more than $5 trillion off the value of equities around the world since China’s shock currency devaluation on Aug. 11.

Source : Bloomberg