LONDON: Gold prices sank further Wednesday while major stock markets mostly dropped on fresh economic jitters caused by China-US trade uncertainty and some weak company earnings.
London's benchmark FTSE 100 index was a rare climber as the pound dropped on better-than-expected UK inflation data that signalled another potential interest rate cut from the Bank of England this year.
However, after Chinese stock indices ended lower, major eurozone equity markets were in the red in midday trading.
Focus was very much on gold, with traders "desperately trying to gauge whether... (Tuesday's) historical collapse was indicative of a new period of weakness or simply a case of blowing off steam after a dramatic surge into record highs," said Joshua Mahony, chief market analyst at Scope Markets.
Gold, seen as a safe-haven investment, tanked as much as six per cent at one point Tuesday and continued to fall during Asian trading hours.
The precious metal dropped to around US$4,000 an ounce Wednesday after chalking up a record peak above US$4,381 Monday.
The retreat hit share prices of gold miners, while individual companies were impacted by earnings updates.
In Paris, L'Oreal shed 6.5 per cent after the cosmetics giant posted third-quarter earnings that undershot analysts' expectations.
On the upside, Barclays and UniCredit posted positive results, easing fears of a new banking crisis emerging in the United States.
There were also concerns regarding US-China trade relations after President Donald Trump said a meeting with his counterpart Xi Jinping might not occur.
Trump said Tuesday that he expected to seal a "good" trade deal with Xi at the APEC summit in South Korea next week, adding that "I think we're going to have a very successful meeting. Certainly, there are a lot of people that are waiting for it."
But he then added: "Maybe it won't happen. Things can happen where, for instance, maybe somebody will say, 'I don't want to meet. It's too nasty.' But it's really not nasty."
Oil prices rallied Wednesday on speculation that India would agree to cut its purchases of the commodity from Russia as part of a trade deal with the United States.
Trump has claimed New Delhi pledged to reduce its imports from Russia, which Washington says helps finance Moscow's war in Ukraine.
