GLOBAL MARKETS-Gold hits new high, dollar rebounds

* Gold hits new high on inflation worries

* Dollar rises on jobs data, euro slips

* Stocks mixed

By Jeremy Gaunt, European Investment Correspondent

LONDON, Nov 8 (BestGrowthStock) – Gold hit a new high on Monday,
stoked by rising inflation expectations following the Federal
Reserve’s return to asset buying, and the dollar gained in a
hang-over from last week’s relatively upbeat U.S. jobs data.

World stocks as measured by MSCI (.MIWD00000PUS: ) were down
0.2 percent after last week hitting levels last reached prior to
the collapse of Lehman Brothers. Emerging market stocks
(.MSCIEF: ) were flat.

Wall Street also looked set to open lower.

Investors were digesting an idea floated in The Financial
Times by World Bank President Robert Zoellick that leading
economies should consider readopting a modified global gold
standard to guide currency movements. [ID:nSGE6A702V]

Gold (XAU=: ) [GOL/] briefly powered to a record above $1,398
an ounce in Asia, mainly driven by concerns that the Fed’s
renewed quantitative easing programme will stoke underlying
inflation. The metal later was down about a quarter of a

Ong Yi Ling, analyst at Phillip Futures in Singapore, said
gold prices had barely reacted to Zoellick’s comments. “Going
forward that would be something that we could look towards, but
it’s not going to happen within a short period of time.”

The dollar is also widely seen weakening as a result of the
$600 ‘QE2’ billion programme, which essentially entails printing
more money. Gold tends to rise when the dollar is weak.

On Monday, however, the U.S. currency was up 0.6 percent
against a basket of major competitors (.DXY: ), recouping recent
losses following better than expected U.S jobs data on Friday.

“As we’ve had a good run on positive U.S. data, the market
is buying back an oversold dollar,” said Keiji Matsumoto,
strategist at Nikko Cordial Securities.

The euro was notably weak, down 0.9 percent at $1.3920
(EUR=: ).

Some of the euro’s fall against the dollar reflected renewed
concern about some of the single currency bloc’s peripheral

Newspaper reports raising fresh doubts about Ireland’s
ability to fund itself internationally have weighed on the euro
and caused spreads between Irish and German government bond
yields to widen.

“Now that QE by the Fed has become a fact, the market is
paying attention to other factors that were overshadowed ahead
of the Fed meeting,” said Roberto Mialich, currency strategist
at Unicredit in Milan.


European shares were slightly lower as investors cashed in
on six-month high prices reached on Friday.

The Athens bourse’s banking index (.FTATBNK: ) jumped 3.4
percent, however, after results of local elections ruled out a
snap general election in the economically strapped euro zone

The FTSEurofirst 300 (.FTEU3: ) index of top European shares
was down 0.1 percent.

“Some degree of profit-taking doesn’t come as a surprise
after a gain of about 15 percent since late August. The market
might lack a little bit of direction for the first day or two of
the week,” said Keith Bowman, analyst at Hargreaves Lansdown.

Investors were more bullish in Japan, taking the Nikkei
average (.N225: ) up 1.1 percent to a three-month closing high.

(Additional reporting by Tamawa Desai and Atul Prakash;
Editing by John Stonestreet)

GLOBAL MARKETS-Gold hits new high, dollar rebounds