GLOBAL MARKETS-Gold, oil slump on global economy fears

By Rafael Nam

HONG KONG (Reuters) - Gold prices slumped more than 2 percent to their lowest in a month and oil dropped as doubts about the global economy continued to unnerve commodity asset classes that had soared to record highs as early as this week.

Asian resource and mining stocks fell, while renewed credit crisis fears also dragged down indexes across the region just one day after investors had cheered hefty U.S. interest rate cuts and resilient results from leading U.S. investment banks.

European shares were expected to fall, with major indexes seen down around 1.6 percent to 2.1 percent.

But the dollar gained against the euro after some initial volatility on the back of the decline in commodity prices, though volumes were reduced as markets in Japan were closed for a public holiday.

"We're seeing a return to reality with regard to the situation in the U.S.," said Savanth Sebastian, equities economist at CommSec in Australia.

"The trend in the U.S. remains the same, credit markets remain tight and possible writedowns can continue."

Gold <XAU=> tumbled more than 2 percent to as low as $920.30 an ounce, its lowest since Feb. 20., after prices had already slumped 6 percent on Wednesday in its biggest one-day percentage drop in nearly two years. Bullion last traded at $936.60.

That marked a severe retreat from a record $1,030.80 an ounce hit on Monday, though prices are still up some 12 percent so far this year.