MUMBAI (Reuters) - Analysts presented a mixed outlook for gold this week on Monday, though they agreed the metal's bull run was likely to be intact in the near term.
"I see a fall this week on a much needed correction because of the way it went up," said T. Gnanasekar, director at Commtrendz Research. "But expectations of a rate cut in the U.S. is likely to make it rally again."
Indian gold prices moved in tandem with the overseas markets, where the metal hit a 28-year high on Friday at $770 an ounce. On Monday, markets softened on profit taking and at 5:00 p.m., international spot gold was at $748.60.
In the local market, gold futures on the Multi Commodity Exchange of India Ltd. hit a year's high of 9,950 rupees per 10 grams on Oct. 17.
"After its major rally last week, gold has not corrected much, so it may fall some more," said Kishore Narne, vice president at Anand Rathi Commodities.
Both Narne and Gnanasekar said dips from current levels could be buying opportunities as the market is likely to rally again in the next couple of weeks.
Lack of good physical demand in India as well other world markets is a concern, another analyst said.
"It remains to be seen how much gold must drop in order to attract the physical buyers," said Pradeep Unni, assistant vice president, commodity research at Vision Commodities Services DMCC.
Few U.S. economic indicators are expected this week, including home sales and consumer confidence data, but markets are eyeing the Oct 31 Federal Reserve interest rates meet.
Monday, October 22, 2007
US gold ends 1 pct down on equity losses, dlr rise
Gold futures in New York
finished sharply lower in heavy turnover after hitting a 10-day
low on Monday as losses in global stocks combined with a rising
dollar and weaker crude prompted bullion investors to lock in
profits. "Today's losses began with total asset liquidation that
began with the stock market weakness on Friday. Last night in
Asian hours we began to see the gold market lose value along
with crude oil's decline," said Carlos Perez-Santalla, a COMEX
floor trader of Hudson River Futures in New York. Most-active December gold (GCZ7: Quote, Profile, Research) on the COMEX division of
the New York Mercantile Exchange settled down $8.40 or 1.1
percent at $760.00 an ounce. It hit a session high of $772.80. Perez-Santalla also cited comments by U.S. Treasury
Secretary Henry Paulson affirming his strong dollar view, which
helped knock gold down further. [ID:nN19387133] The dollar rallied from session lows on Monday, climbing
from all-time lows on Monday as investors covered short
positions to pull back from risky bets. The Dow industrials (.DJI: Quote, Profile, Research) and S&P 500 (.SPX: Quote, Profile, Research) retraced early
losses and were little changed by midafternoon trade as
investors worried the credit market problems were having a
widening impact on the economy. On Friday, the Dow Jones industrials average lost 366 points
on the 20th anniversary of the 1987 market crash. In early electronic trade, December gold traded as low as
$749 an ounce, which marked the weakest level since Oct 11. Perez-Santalla said that gold futures' fall on Monday was
just a temporary pullback from a long-term move. "Until we break underneath the $725 level, the entire upside
move that we have seen since the beginning of September is still
intact," he said. Meanwhile, oil fell as much as $2 as financial markets
tumbled on growing concerns over the health of the U.S. economy,
triggering a correction from recent record highs. U.S. crude
(CLc1: Quote, Profile, Research) settled down $1.04 at $87.56 a barrel on Monday. The U.S. Commodity Futures Trading Commission said in its
latest Commitment of Traders report that speculative net longs
in COMEX gold rose 5.9 percent in the week to Oct. 16, after the
previous week's gain of 8.4 percent. [ID:nN19329151] Net longs in COMEX silver held by noncommercials climbed 2.3
percent. A week ago, they rose 6.2 percent. Trading was heavy on Monday. COMEX estimated final volume at
156,367 contracts, and gold options were estimated at 11,820
lots. Turnover in Chicago Board of Trade electronic 100-oz gold
futures was 39,563 lots at 2:51 p.m. EDT (1851 GMT)
http://www.cbot.com/cbot/pub/page. Market-watchers in the precious metals sector recently said
that gold could consolidate in the near term because of its
sharp gains and the build-up of speculative long positions. They
said that the gold market would not be immune if there was a
correction in global markets. John Reade, head of precious metals strategy of UBS in
London, told clients in a note that speculative longs on U.S.
futures markets hit another all-time high as of last Tuesday. "The weight of these positions explains why we are concerned
about the potential for a correction in gold in the near term,"
Reade said. In addition, Reade said that if risk aversion continued to
increase, it would probably trigger more losses in gold,
especially if it prompted unwinding in foreign-exchange carry
trades. At 2:15 p.m., spot bullion traded down at
$752.90/753.70, compared with the Friday New York close at
$765.30/766.10. London bullion dealers fixed the afternoon spot
reference price at $751.25. COMEX December silver (SIZ7: Quote, Profile, Research) closed down 8.0 cents at
$13.555 an ounce, trading between $13.325 and $13.670. Spot silver was quoted at $13.43/13.48, which was
lower than Friday's late New York quote of $13.52/13.57. London
silver was fixed at $13.35. NYMEX January platinum (PLF8: Quote, Profile, Research) fell $8.80 to end at $1,439.80
an ounce. Spot platinum was quoted at $1,431/1,436. December palladium (PAZ7: Quote, Profile, Research) closed down $7.35 or 2.0 percent
to $365.15 an ounce. Spot palladium fetched $357/360.
finished sharply lower in heavy turnover after hitting a 10-day
low on Monday as losses in global stocks combined with a rising
dollar and weaker crude prompted bullion investors to lock in
profits. "Today's losses began with total asset liquidation that
began with the stock market weakness on Friday. Last night in
Asian hours we began to see the gold market lose value along
with crude oil's decline," said Carlos Perez-Santalla, a COMEX
floor trader of Hudson River Futures in New York. Most-active December gold (GCZ7: Quote, Profile, Research) on the COMEX division of
the New York Mercantile Exchange settled down $8.40 or 1.1
percent at $760.00 an ounce. It hit a session high of $772.80. Perez-Santalla also cited comments by U.S. Treasury
Secretary Henry Paulson affirming his strong dollar view, which
helped knock gold down further. [ID:nN19387133] The dollar rallied from session lows on Monday, climbing
from all-time lows on Monday as investors covered short
positions to pull back from risky bets. The Dow industrials (.DJI: Quote, Profile, Research) and S&P 500 (.SPX: Quote, Profile, Research) retraced early
losses and were little changed by midafternoon trade as
investors worried the credit market problems were having a
widening impact on the economy. On Friday, the Dow Jones industrials average lost 366 points
on the 20th anniversary of the 1987 market crash. In early electronic trade, December gold traded as low as
$749 an ounce, which marked the weakest level since Oct 11. Perez-Santalla said that gold futures' fall on Monday was
just a temporary pullback from a long-term move. "Until we break underneath the $725 level, the entire upside
move that we have seen since the beginning of September is still
intact," he said. Meanwhile, oil fell as much as $2 as financial markets
tumbled on growing concerns over the health of the U.S. economy,
triggering a correction from recent record highs. U.S. crude
(CLc1: Quote, Profile, Research) settled down $1.04 at $87.56 a barrel on Monday. The U.S. Commodity Futures Trading Commission said in its
latest Commitment of Traders report that speculative net longs
in COMEX gold rose 5.9 percent in the week to Oct. 16, after the
previous week's gain of 8.4 percent. [ID:nN19329151] Net longs in COMEX silver held by noncommercials climbed 2.3
percent. A week ago, they rose 6.2 percent. Trading was heavy on Monday. COMEX estimated final volume at
156,367 contracts, and gold options were estimated at 11,820
lots. Turnover in Chicago Board of Trade electronic 100-oz gold
futures was 39,563 lots at 2:51 p.m. EDT (1851 GMT)
http://www.cbot.com/cbot/pub/page. Market-watchers in the precious metals sector recently said
that gold could consolidate in the near term because of its
sharp gains and the build-up of speculative long positions. They
said that the gold market would not be immune if there was a
correction in global markets. John Reade, head of precious metals strategy of UBS in
London, told clients in a note that speculative longs on U.S.
futures markets hit another all-time high as of last Tuesday. "The weight of these positions explains why we are concerned
about the potential for a correction in gold in the near term,"
Reade said. In addition, Reade said that if risk aversion continued to
increase, it would probably trigger more losses in gold,
especially if it prompted unwinding in foreign-exchange carry
trades. At 2:15 p.m., spot bullion
$752.90/753.70, compared with the Friday New York close at
$765.30/766.10. London bullion dealers fixed the afternoon spot
reference price at $751.25. COMEX December silver (SIZ7: Quote, Profile, Research) closed down 8.0 cents at
$13.555 an ounce, trading between $13.325 and $13.670. Spot silver
lower than Friday's late New York quote of $13.52/13.57. London
silver was fixed at $13.35. NYMEX January platinum (PLF8: Quote, Profile, Research) fell $8.80 to end at $1,439.80
an ounce. Spot platinum
to $365.15 an ounce. Spot palladium
Commodities Retreat As Dollar Rebounds
Investors retreated from the commodities markets Monday amid concerns that global economic growth could slow, damping demand for raw materials.
Early declines in the stock market, and the dollar's bounce off a record low, added to the pressure on commodity prices. Energy futures declined, as did precious and industrial metals and most agricultural products.
With speculative investment in many commodities near record levels, the linkages between Wall Street and the oil, agriculture and metals markets have grown increasingly tight, analysts say. The dollar's influence on commodities has grown, as well. A declining dollar gives foreign buyers incentive to buy cheaper oil or wheat, while a stronger greenback makes prices look more expensive abroad, hurting demand.
Major stock indexes were volatile on Monday amid worries about the credit and housing markets. Wall Street moved lower before making a comeback to finish moderately higher. As stocks rose, commodities pared the worst of their losses but remained in negative territory.
Light, sweet crude for November delivery fell $1.04 to settle at $87.56 a barrel on the New York Mercantile Exchange. Gold for December delivery dropped $8.40 to end at $760 an ounce on the Nymex. On the Chicago Board of Trade, December corn lost 5.75 cents to $3.645 a bushel.
The parallel move in the commodity and equity markets over the past six weeks has been strong, said Richard Feltes, director of MF Global Research in Chicago.
"I think we're in a situation in which we are trading in tandem," he said, adding that "for commodities, the real story still goes back to Asian growth, specifically China and their voracious commodity demand. Until that shows signs of waning, unless there is an equity meltdown, I think the commodity boom is still intact."
Still, recent developments have left investors nervous about the health of the global economy. Finance ministers of the world's seven richest nations warned over the weekend that "uneven conditions" in global financial markets would likely persist for some time, even as they pledged to do what they could to limit the damage. That joint commitment came after a rough session on Wall Street, when the Dow Jones industrial average plunged more than 360 points on Friday.
Exacerbating the worries about economic growth was oil's surge over $90 a barrel last week and the dollar's slump to an all-time low against the euro earlier Monday. The 13-nation currency bought a peak $1.4348 in early trading before easing back.
Copper, nickel and zinc prices fell on the London Metal Exchange. Gasoline futures traded on the Nymex fell 3.53 cents to settle at $2.1332 a gallon. Wheat recovered from early losses to gain 15.5 cents to $8.71 a bushel on the CBOT, while soybeans for November delivery dipped 6.75 cents to $9.765 a bushel.
Early declines in the stock market, and the dollar's bounce off a record low, added to the pressure on commodity prices. Energy futures declined, as did precious and industrial metals and most agricultural products.
With speculative investment in many commodities near record levels, the linkages between Wall Street and the oil, agriculture and metals markets have grown increasingly tight, analysts say. The dollar's influence on commodities has grown, as well. A declining dollar gives foreign buyers incentive to buy cheaper oil or wheat, while a stronger greenback makes prices look more expensive abroad, hurting demand.
Major stock indexes were volatile on Monday amid worries about the credit and housing markets. Wall Street moved lower before making a comeback to finish moderately higher. As stocks rose, commodities pared the worst of their losses but remained in negative territory.
Light, sweet crude for November delivery fell $1.04 to settle at $87.56 a barrel on the New York Mercantile Exchange. Gold for December delivery dropped $8.40 to end at $760 an ounce on the Nymex. On the Chicago Board of Trade, December corn lost 5.75 cents to $3.645 a bushel.
The parallel move in the commodity and equity markets over the past six weeks has been strong, said Richard Feltes, director of MF Global Research in Chicago.
"I think we're in a situation in which we are trading in tandem," he said, adding that "for commodities, the real story still goes back to Asian growth, specifically China and their voracious commodity demand. Until that shows signs of waning, unless there is an equity meltdown, I think the commodity boom is still intact."
Still, recent developments have left investors nervous about the health of the global economy. Finance ministers of the world's seven richest nations warned over the weekend that "uneven conditions" in global financial markets would likely persist for some time, even as they pledged to do what they could to limit the damage. That joint commitment came after a rough session on Wall Street, when the Dow Jones industrial average plunged more than 360 points on Friday.
Exacerbating the worries about economic growth was oil's surge over $90 a barrel last week and the dollar's slump to an all-time low against the euro earlier Monday. The 13-nation currency bought a peak $1.4348 in early trading before easing back.
Copper, nickel and zinc prices fell on the London Metal Exchange. Gasoline futures traded on the Nymex fell 3.53 cents to settle at $2.1332 a gallon. Wheat recovered from early losses to gain 15.5 cents to $8.71 a bushel on the CBOT, while soybeans for November delivery dipped 6.75 cents to $9.765 a bushel.
China likely to import more gold next year
A Chinese gold industry expert says gold imports to the country are likely to rise next year as investment demand grows.
Gold consumption in China has risen by more than 50% in the past five years, Zhang Weixing said. He estimates that Chinese gold reserves are at about 4,000 tonnes and that the People’s Bank of China holds about 600 tonnes.
Spot bullion is currently trading at $750.90 per ounce.
Gold consumption in China has risen by more than 50% in the past five years, Zhang Weixing said. He estimates that Chinese gold reserves are at about 4,000 tonnes and that the People’s Bank of China holds about 600 tonnes.
Spot bullion is currently trading at $750.90 per ounce.
Oil, Metals Fall on Concern Credit-Market Rout May Hurt Demand
Oct. 22 (Bloomberg) -- Oil, gold and copper prices fell on speculation credit-market losses may stunt economic expansion, curbing demand for energy and metals.
Declines in the three commodities follow a statement from the Group of Seven nations expressing concern that U.S. subprime loan defaults may prompt a growth slowdown. Copper fell to a five-week low, while gold slipped from its highest in 27 years. Oil retreated after last week touching a record above $90 a barrel.
``It's concern about the U.S. economy and the impact of a slowdown of the U.S.'' which is driving oil prices down, said Eugen Weinberg, a commodities analyst at Commerzbank AG in Frankfurt. ``The U.S. alone is responsible for a quarter of overall oil consumption.''
Crude oil for December delivery, the most actively traded contract on the New York Mercantile Exchange, fell as much as $2.22, or 2.6 percent, to $84.73, and traded at $85.63 at 2:03 p.m. London time. The November contract, which expires today, was down $1.42 at $87.18.
Oil also declined after the U.S. Defense Secretary Robert Gates said a Turkish raid on rebels in Iraq, home to the world's third-largest oil reserves, wasn't ``imminent.'' Oil touched an intraday record of $90.07 on Oct. 19, the highest since futures began trading in 1983, after Turkish lawmakers approved a resolution on military force.
``Turkey's relationship with northern Iraq is a never-ending story,'' said Johannes Benigni, managing director at PVM Oil Associates GmbH in Vienna. ``The downside risk is clearly mounting and I don't count on this oil price to stay here very much longer.''
Financial Turbulence
Recent financial market turbulence, high oil prices and weakness in the U.S. housing market are likely to ``moderate'' global expansion, officials said in a statement after the meeting G-7 finance ministers and central banker in Washington on Oct. 19.
``We could see a real slow-down in demand if the U.S. economy starts to slow and goes into recession,'' said Rick Mueller, an analyst with Energy Security Analysis Inc. in Wakefield, Massachusetts.
Brent crude for December settlement was trading down $1.50 at $82.29 a barrel on the London-based ICE Futures Europe exchange at 2:06 p.m. local time.
Twenty of 29 analysts surveyed by Bloomberg News on Oct. 19 said crude oil may decline this week because high prices have slowed demand growth, allowing U.S. fuel stockpiles to increase.
U.S. Defense Secretary Gates, after meeting his Turkish counterpart, said he ``didn't have the impression'' military action was ``imminent.''
Border Tension
The U.S. says it wants Turkey to show restraint as a cross- border offensive against the Kurdistan Workers party, or PKK, may exacerbate regional violence.
The latest clash yesterday between Turkey's army and Kurdish militants near the border with Iraq killed 44 people. Thirty-two members of the Kurdistan Workers' Party, or PKK, who had crossed into Turkey from Iraq, and 12 Turkish soldiers died in the fighting, the Turkish armed forces said on its Web site.
Copper for delivery in three months on the London Metal Exchange fell $154, or 2 percent, to $7,716 a metric ton by 2 p.m. in London. It earlier fell as low as $7,695.
``There is a fear of slower economic growth that would directly link to slower demand for base metals,'' Peter Fertig, a commodity consultant at Dresdner Kleinwort, said today by phone from Hainburg, Germany.
Gold for immediate delivery fell $13.69, or 1.8 percent, to $752.80 an ounce at 1:56 p.m. London time. It rose to a 27-year high of $771.10 an ounce on Oct. 19.
Declines in the three commodities follow a statement from the Group of Seven nations expressing concern that U.S. subprime loan defaults may prompt a growth slowdown. Copper fell to a five-week low, while gold slipped from its highest in 27 years. Oil retreated after last week touching a record above $90 a barrel.
``It's concern about the U.S. economy and the impact of a slowdown of the U.S.'' which is driving oil prices down, said Eugen Weinberg, a commodities analyst at Commerzbank AG in Frankfurt. ``The U.S. alone is responsible for a quarter of overall oil consumption.''
Crude oil for December delivery, the most actively traded contract on the New York Mercantile Exchange, fell as much as $2.22, or 2.6 percent, to $84.73, and traded at $85.63 at 2:03 p.m. London time. The November contract, which expires today, was down $1.42 at $87.18.
Oil also declined after the U.S. Defense Secretary Robert Gates said a Turkish raid on rebels in Iraq, home to the world's third-largest oil reserves, wasn't ``imminent.'' Oil touched an intraday record of $90.07 on Oct. 19, the highest since futures began trading in 1983, after Turkish lawmakers approved a resolution on military force.
``Turkey's relationship with northern Iraq is a never-ending story,'' said Johannes Benigni, managing director at PVM Oil Associates GmbH in Vienna. ``The downside risk is clearly mounting and I don't count on this oil price to stay here very much longer.''
Financial Turbulence
Recent financial market turbulence, high oil prices and weakness in the U.S. housing market are likely to ``moderate'' global expansion, officials said in a statement after the meeting G-7 finance ministers and central banker in Washington on Oct. 19.
``We could see a real slow-down in demand if the U.S. economy starts to slow and goes into recession,'' said Rick Mueller, an analyst with Energy Security Analysis Inc. in Wakefield, Massachusetts.
Brent crude for December settlement was trading down $1.50 at $82.29 a barrel on the London-based ICE Futures Europe exchange at 2:06 p.m. local time.
Twenty of 29 analysts surveyed by Bloomberg News on Oct. 19 said crude oil may decline this week because high prices have slowed demand growth, allowing U.S. fuel stockpiles to increase.
U.S. Defense Secretary Gates, after meeting his Turkish counterpart, said he ``didn't have the impression'' military action was ``imminent.''
Border Tension
The U.S. says it wants Turkey to show restraint as a cross- border offensive against the Kurdistan Workers party, or PKK, may exacerbate regional violence.
The latest clash yesterday between Turkey's army and Kurdish militants near the border with Iraq killed 44 people. Thirty-two members of the Kurdistan Workers' Party, or PKK, who had crossed into Turkey from Iraq, and 12 Turkish soldiers died in the fighting, the Turkish armed forces said on its Web site.
Copper for delivery in three months on the London Metal Exchange fell $154, or 2 percent, to $7,716 a metric ton by 2 p.m. in London. It earlier fell as low as $7,695.
``There is a fear of slower economic growth that would directly link to slower demand for base metals,'' Peter Fertig, a commodity consultant at Dresdner Kleinwort, said today by phone from Hainburg, Germany.
Gold for immediate delivery fell $13.69, or 1.8 percent, to $752.80 an ounce at 1:56 p.m. London time. It rose to a 27-year high of $771.10 an ounce on Oct. 19.
Paulson Addresses Global Impact Of Credit Crunch At IMF Summit
Addressing the IMF Global Summit, Treasury Secretary Henry Paulson discussed the impact of financial turbulence on the global economy, citing the “changing and challenging financial landscape and how imperative it is that we adapt ourselves and our institutions to meet these challenges.”
The growing interconnectivity of global capital markets has made the system as a whole stronger in terms of sustaining growth, Paulson said. However, he said nations need to be careful about the increased risks associated with interdependence.
“Global growth and financial soundness depend increasingly on dynamic emerging market economies, rather than overwhelmingly on industrial countries,” he stated.
“Accelerating globalization has heightened our awareness of the links between energy and environmental policies and longer-term global economic prospects,” he said.The ripple effect of problems in the subprime mortgage market in the United States growing into a global credit crunch are something that markets need to learn from, Paulson said.
“We need to continue to be vigilant, because all of our capital markets are not yet functioning normally,” Paulson cautioned.
He added that long-term changes need to take place in order to “prevent a repeat of recent excesses.”
The U.S. Treasury Secretary commented on China, India, and Russia's prominent role in global economic growth. The report on global economic growth released last week by the IMF stated those three countries accounted for more half of global growth.
“Emerging markets as a whole are growing more than twice as fast as industrial economies, and account for a rising share of global trade and investment,” Paulson said. “Such realities need to be reflected in international financial and economic institutions, both in the focus of their work, and in their governance structures.”
Energy policy was another issue addressed at the conference.
“Any long-term view of global economic prospects must take into account energy security, deal with the global challenge of climate change and address environmental impacts for future generations,” Paulson said.
He emphasized President Bush's proposal for an international clean technology fund and attempts to work with producers of greenhouse gas emissions.
The growing interconnectivity of global capital markets has made the system as a whole stronger in terms of sustaining growth, Paulson said. However, he said nations need to be careful about the increased risks associated with interdependence.
“Global growth and financial soundness depend increasingly on dynamic emerging market economies, rather than overwhelmingly on industrial countries,” he stated.
“Accelerating globalization has heightened our awareness of the links between energy and environmental policies and longer-term global economic prospects,” he said.The ripple effect of problems in the subprime mortgage market in the United States growing into a global credit crunch are something that markets need to learn from, Paulson said.
“We need to continue to be vigilant, because all of our capital markets are not yet functioning normally,” Paulson cautioned.
He added that long-term changes need to take place in order to “prevent a repeat of recent excesses.”
The U.S. Treasury Secretary commented on China, India, and Russia's prominent role in global economic growth. The report on global economic growth released last week by the IMF stated those three countries accounted for more half of global growth.
“Emerging markets as a whole are growing more than twice as fast as industrial economies, and account for a rising share of global trade and investment,” Paulson said. “Such realities need to be reflected in international financial and economic institutions, both in the focus of their work, and in their governance structures.”
Energy policy was another issue addressed at the conference.
“Any long-term view of global economic prospects must take into account energy security, deal with the global challenge of climate change and address environmental impacts for future generations,” Paulson said.
He emphasized President Bush's proposal for an international clean technology fund and attempts to work with producers of greenhouse gas emissions.
European Markets Fall, Led By Miners, Oils
The European markets fell on Monday, as fears of slower economic growth hit mining stocks and a drop in crude oil prices sent energy stocks down.
Crude for November delivery fell $1.71 to $86.69 a barrel on the New York Mercantile Exchange, by the time the European markets closed, amid concerns about economic growth and on profit-taking ahead of expiration of the November contract.
The FTSEurofirst 300 index of pan-European blue chips closed 1.29% lower at 1,543.66 points, while the narrower DJ Stoxx 50 index fell 1.12% to 3,777.24 points.
Around Europe, the U.K.'s FTSE 100 index fell 1.05% to 6,459.30, while France's CAC 40 index dropped 1.38% to 5,661.27 and Germany's DAX index slipped 1.13% to 7,794.94.
Mining stocks slipped after metal prices fell amid concerns that slower economic growth will reduce demand. BHP Billiton, the world's biggest miner, dropped 3.9%, while Anglo American, the second biggest, slipped 4.8% and Rio Tinto, the third biggest, fell 3.7%. Copper miner Antofagsta lost 4.6%.
Some other economic growth sensitive stocks such as Daimler, the world's largest truckmaker, and Royal Philips Electronics, Europe's biggest maker of consumer electronics, were also among the losers. Daimler dropped 2.9% and Philips lost 2.3%.
Heavily weighted oil stocks edged lower after crude oil prices fell below $87 a barrel. BP, Europe's biggest oil company, slipped 1%, while Royal/Dutch Shell, the second biggest, fell 1.1% and Total, the third biggest, dropped 1.5%.
Electrolux, the world's second largest household appliances maker, slid 8.2% after the company said lower U.S. demand and higher steel and plastic costs may hurt earnings growth this year.
Commerzbank, Germany's second largest bank, fell 2.9% after the company's Chief Executive Officer Klaus-Peter Mueller said that the bank's losses from investments linked to risky subprime mortgages would be higher than previously expected.
Danish beermaker Carlsberg slipped 2.4% after the Financial Times reported that the company is planning a rights offer valued at $5.8 billion to fund its proposed takeover bid for British brewer Scottish & Newcastle.
Crude for November delivery fell $1.71 to $86.69 a barrel on the New York Mercantile Exchange, by the time the European markets closed, amid concerns about economic growth and on profit-taking ahead of expiration of the November contract.
The FTSEurofirst 300 index of pan-European blue chips closed 1.29% lower at 1,543.66 points, while the narrower DJ Stoxx 50 index fell 1.12% to 3,777.24 points.
Around Europe, the U.K.'s FTSE 100 index fell 1.05% to 6,459.30, while France's CAC 40 index dropped 1.38% to 5,661.27 and Germany's DAX index slipped 1.13% to 7,794.94.
Mining stocks slipped after metal prices fell amid concerns that slower economic growth will reduce demand. BHP Billiton, the world's biggest miner, dropped 3.9%, while Anglo American, the second biggest, slipped 4.8% and Rio Tinto, the third biggest, fell 3.7%. Copper miner Antofagsta lost 4.6%.
Some other economic growth sensitive stocks such as Daimler, the world's largest truckmaker, and Royal Philips Electronics, Europe's biggest maker of consumer electronics, were also among the losers. Daimler dropped 2.9% and Philips lost 2.3%.
Heavily weighted oil stocks edged lower after crude oil prices fell below $87 a barrel. BP, Europe's biggest oil company, slipped 1%, while Royal/Dutch Shell, the second biggest, fell 1.1% and Total, the third biggest, dropped 1.5%.
Electrolux, the world's second largest household appliances maker, slid 8.2% after the company said lower U.S. demand and higher steel and plastic costs may hurt earnings growth this year.
Commerzbank, Germany's second largest bank, fell 2.9% after the company's Chief Executive Officer Klaus-Peter Mueller said that the bank's losses from investments linked to risky subprime mortgages would be higher than previously expected.
Danish beermaker Carlsberg slipped 2.4% after the Financial Times reported that the company is planning a rights offer valued at $5.8 billion to fund its proposed takeover bid for British brewer Scottish & Newcastle.
N.Y. Oil Falls From Record on as Turkish Assault Fears Ease
Oct. 22 (Bloomberg) -- Crude oil fell from a record as concern eased that a Turkish assault on Kurdish militants in northern Iraq was imminent.
Turkey's government, which came under pressure to invade Iraq after eight Turkish soldiers were missing after fighting near the Iraqi border, said it would give diplomacy a chance. An Iraqi pipeline carried 153,000 barrels of oil a day last month to the Turkish port of Ceyhan, a Bloomberg News survey showed.
``First the Turks were going to invade, then they weren't going to invade,'' said Roger Read, an analyst with Natixis Bleichroeder Inc. in Houston.
Crude oil for November delivery fell $1.04, or 1.2 percent, to settle at $87.56 a barrel at 2:50 p.m. on the New York Mercantile Exchange. The November contract expired today. The more actively traded December contract fell 93 cents to $86.02.
The Kurdistan Workers' Party, or PKK, has agreed to find a political solution to the conflict with Turkey ``away from violence and fighting,'' the group said in a statement today on the Web site of Iraq President Jalal Talabani's Patriotic Union of Kurdistan movement.
Turkey's government will give diplomacy a chance. Spokesman Cemil Cicek said the government was calling for ``common sense and unity.''
``The PKK statement was not as bearish as expected, as they only reaffirm a cease-fire they say has been in place since June,'' said Tim Evans, an analyst with Citigroup Global Markets Inc. in New York.
Raid Not `Imminent'
U.S. Defense Secretary Robert Gates said a Turkish raid on rebels in Iraq wasn't ``imminent.'' The U.S. says it wants Turkey to show restraint as a cross-border offensive against the PKK may exacerbate regional violence.
The latest clash yesterday between Turkey's army and Kurdish militants near the border with Iraq killed 44 people. Thirty-two members of the Kurdistan Workers' Party, or PKK, who had crossed into Turkey from Iraq, and 12 Turkish soldiers died in the fighting, the Turkish armed forces said on its Web site.
``It looks like the White House is putting a lot of pressure on the Turks to hold off now and the Turks are saying they will wait a bit,'' Mueller said.
U.S. stock markets rose today, retracing some of last week's losses and lessening concern that world economic growth may slow, reducing energy demand.
``This morning, everyone wanted to throw themselves out a window, and now that the Dow is up, they figure the economy is going to be OK,'' Read said.
The Dow Jones Industrial Average was up 22.93 at 13,544.95 as of 2:10 p.m. New York time. It fell 366.94, or 2.6 percent, on Oct. 19.
Oil touched an intraday record of $90.07 on Oct. 19, the highest since futures began trading in 1983, after Turkish lawmakers approved a resolution to strike militants in Iraq, home to the world's third-largest oil reserves.
Brent crude oil for December settlement fell 52 cents to $83.27 a barrel on the London-based ICE Futures Europe exchange.
Twenty of 29 analysts surveyed by Bloomberg News on Oct. 19 said crude oil may decline this week.
Turkey's government, which came under pressure to invade Iraq after eight Turkish soldiers were missing after fighting near the Iraqi border, said it would give diplomacy a chance. An Iraqi pipeline carried 153,000 barrels of oil a day last month to the Turkish port of Ceyhan, a Bloomberg News survey showed.
``First the Turks were going to invade, then they weren't going to invade,'' said Roger Read, an analyst with Natixis Bleichroeder Inc. in Houston.
Crude oil for November delivery fell $1.04, or 1.2 percent, to settle at $87.56 a barrel at 2:50 p.m. on the New York Mercantile Exchange. The November contract expired today. The more actively traded December contract fell 93 cents to $86.02.
The Kurdistan Workers' Party, or PKK, has agreed to find a political solution to the conflict with Turkey ``away from violence and fighting,'' the group said in a statement today on the Web site of Iraq President Jalal Talabani's Patriotic Union of Kurdistan movement.
Turkey's government will give diplomacy a chance. Spokesman Cemil Cicek said the government was calling for ``common sense and unity.''
``The PKK statement was not as bearish as expected, as they only reaffirm a cease-fire they say has been in place since June,'' said Tim Evans, an analyst with Citigroup Global Markets Inc. in New York.
Raid Not `Imminent'
U.S. Defense Secretary Robert Gates said a Turkish raid on rebels in Iraq wasn't ``imminent.'' The U.S. says it wants Turkey to show restraint as a cross-border offensive against the PKK may exacerbate regional violence.
The latest clash yesterday between Turkey's army and Kurdish militants near the border with Iraq killed 44 people. Thirty-two members of the Kurdistan Workers' Party, or PKK, who had crossed into Turkey from Iraq, and 12 Turkish soldiers died in the fighting, the Turkish armed forces said on its Web site.
``It looks like the White House is putting a lot of pressure on the Turks to hold off now and the Turks are saying they will wait a bit,'' Mueller said.
U.S. stock markets rose today, retracing some of last week's losses and lessening concern that world economic growth may slow, reducing energy demand.
``This morning, everyone wanted to throw themselves out a window, and now that the Dow is up, they figure the economy is going to be OK,'' Read said.
The Dow Jones Industrial Average was up 22.93 at 13,544.95 as of 2:10 p.m. New York time. It fell 366.94, or 2.6 percent, on Oct. 19.
Oil touched an intraday record of $90.07 on Oct. 19, the highest since futures began trading in 1983, after Turkish lawmakers approved a resolution to strike militants in Iraq, home to the world's third-largest oil reserves.
Brent crude oil for December settlement fell 52 cents to $83.27 a barrel on the London-based ICE Futures Europe exchange.
Twenty of 29 analysts surveyed by Bloomberg News on Oct. 19 said crude oil may decline this week.
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