Recovery Doubts Drive Broad Decline
Author: Jerry A. DiColo; Matt Day</br></br>Commodities closely tied to global economic growth fell sharply Thursday as disappointing economic data heightened concerns about the sluggishness of the global recovery.</br></br>Crude-oil futures fell 3.5% in New York trading, gasoline futures dropped below $2 a gallon and copper futures tumbled 2.5%, hurt by U.S. reports on manufacturing, unemployment, home sales and construction spending that added pressure to a market already skittish over the prospect of a slowdown in growth in China.</br></br>Even gold--which hit record highs in recent weeks as investors sought refuge in the metal amid concerns about debt problems in Europe and the deteriorating economic outlook--settled nearly $40 lower, the biggest one-day decline in five months.</br></br>The decline in gold appeared to be tied to a sharp move higher in the euro, traders said, as investors turned more optimistic about the health of Europe's banks. A bearish bet on the euro, coupled with a bullish bet on gold, has been a popular trade among certain investors.