* Gold bounces after hitting weakest in over 2 years
* Wall Street opens higher, though European stocks weaker
* Brent crude falls back below $100 a barrel
By Leah Schnurr
NEW YORK, April 16 Gold and U.S. stocks
rebounded on Tuesday as the previous session's sell-off lured
buyers into the market, but demand concerns sent oil below $100
a barrel for the first time in nine months.
The broad rout in commodities and stocks seen in recent
sessions was triggered by weak data from China and the United
States that have sparked fresh concerns about the strength of
the global economy's recovery.
Gold has fallen about 20 percent so far this year after an
unbroken 12 years of gains and is down some 28 percent from the
record high hit in September 2011 of $1,920.30.
Spot gold lost more than 8 percent on Monday alone
and had dropped further to $1,321.35 an ounce earlier on
Tuesday. It later reversed direction and was recently up 1.6
percent at $1,374.04.
"I think everyone has to take a breath now ... But there are
people who still want to sell and they haven't done so yet,"
said David Govett, head of precious metals at Marex Spectron.
Analysts have cited various reasons for gold's latest slump,
including funds switching out of bullion and the possibility
that other central banks in Europe could use Cyprus's bailout
plans to sell excess gold reserves as a reason to sell some of
their own holdings.
The bounce in gold helped stocks on Wall Street open nearly
1 percent higher, while data that showed U.S. consumer prices
fell in March left room for the Federal Reserve to keep up its
economic stimulus efforts.
"The big thing dragging down stocks yesterday was really the
sharp decline in gold and you see that lifting here a bit," said
Tim Ghriskey, chief investment officer of Solaris Group in
Bedford Hills, New York.
The Dow Jones industrial average gained 105.67
points, or 0.72 percent, to 14,704.87. The Standard & Poor's 500
Index gained 12.49 points, or 0.80 percent, to 1,564.85.
The Nasdaq Composite Index gained 20.02 points, or 0.62
percent, to 3,236.51.
Investors were also taking in a batch of earnings reports
from U.S. companies including Goldman Sachs, which
reported profit that beat expectations.
MSCI's global share index, which tracks
around 9,000 stocks in 45 countries, was up 0.4 percent, having
been almost 0.5 percent lower earlier in the day. The
FTSEurofirst 300 was off 0.3 percent.
But oil continued to languish with Brent crude falling below
$100 a barrel for the first time in nine months as concerns
persisted over the outlook for demand. Brent crude was
down $1.43 at $99.20, while U.S. crude 84 lost cents to
"Somewhat disappointing Chinese GDP data yesterday might
have contributed to the bearish sentiment in the oil futures
markets," analysts at JBC Energy said.
"However ... Monday's sell-off across virtually all
commodities and equities markets and the extent of losses in
some markets is difficult to justify on fundamental grounds
solely, with herd behaviour and momentum trading contributing,"
JBC Energy said.