Monday 8 August 2011

TOP NEWS Oil and Stocks Fall....GOLD RISES RECORD HIGH

Maklumat yang terkandung di sini telah diperolehi daripada sumber-sumber yang dipercayai boleh dipercayai, tetapi tidak ada jaminan kepada kesempurnaan atau ketepatan. Setiap pendapat yang dinyatakan di sini adalah kenyataan pertimbangan kami pada tarikh ini dan tertakluk kepada perubahan tanpa notis.

SINGAPORE,Monday 08/08/2011: Gold surged to a record on Monday and other commodities from oil to grains fell as investors cut riskier assets after the United States lost its top-notch AAA credit rating.

Oil dropped more than $3, while copper, wheat and corn retreated as the outlook for commodity demand deteriorated amid shaky Western economies and a debt crisis in both sides of the Atlantic.

Asian shares slid and the dollar touched a record low versus the Swiss franc, as global policymakers put a brave face on the debt issues hounding the United States and Europe, although their pledge to ensure liquidity did little to pacify nervous investors.

Benefiting from the gloom, gold climbed to an all-time high above $1,703 an ounce, its 11th record in 19 sessions, as investors sought shelter in the precious metal from the turmoil engulfing financial and commodity markets. Gold has gained more than 19 percent so far this year.

"What people are realizing is that dollar and euro currencies have real problems and I think that's manifesting in the gold price," said Dominic Schnider, executive director for wealth management research at UBS.

"I would say the way things evolve right now I really could even imagine $2,000 being in the cards."

Schnider said there was a risk gold could hit that level even before the end of the year if the global economy "does not accelerate, things go really nasty and central banks start to have large purchasing programs of government-related debt".

With the twin debt crises raging and sending equities and commodities plunging, the Group of Seven leaders said they were "ready to take action to ensure stability and liquidity in financial markets".

That followed a surprise statement from the European Central Bank that it would "actively implement" its controversial bond-buying programme to fight the euro zone's debt crisis.

U.S. gold futures also touched a record of $1,705.90 an ounce, while both spot and U.S. silver futures jumped more than 5 percent.

CHINA FACTOR

Standard & Poor's cut the long-term U.S. credit rating to AA-plus on Friday, a move that over time could ripple through markets by pushing up borrowing costs and making it more difficult to secure a lasting recovery.

"In our view, the biggest immediate risk to commodity prices is not the actual downgrade but a further rise in global economic uncertainty and policy risk," Standard Bank analyst Walter de Wet said in a note to clients.

U.S. crude, which is down 7.5 percent so far this year, fell $3.02 to $83.86 a barrel, after hitting a low of $83.55, marking its sixth loss in seven sessions.

Brent oil, up nearly 13 percent on the year, slipped $2.71 to $106.66, off a low of $106.20.

London copper dropped 0.6 percent to $8,990 a tonne, after falling to as low as $8,950 earlier, its weakest since June 27.

In agricultural markets, U.S. soybeans slid to a one-month low, while corn and wheat dropped.

Strong economic growth in China -- the world's top copper consumer, No. 2 oil user and major buyer of grains -- as well as tight global supplies for some raw materials, including coal and iron ore, should provide support to prices.

"China seems to be ticking over fine so commodity demand should be fine," said Graeme Train, commodity analyst at Macquarie in Shanghai.

"China has destocked over the last 12 months after a big round of buying at lower commodity prices. It's potentially set up to do the same kind of buying where an opportunity presents itself."

The Reuters-Jefferies CRB index , the 19-commodity benchmark, fell nearly 4.5 percent last week, its steepest drop since a rout in early May fuelled by concerns about a stalling global economic recovery.

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