Gold fell as global stocks tumbled, sending the Standard & Poor’s 500 Index to a 12-year low, on concern a deepening recession is eroding consumer confidence. Gold for immediate delivery declined as much as 0.7 percent to $984.53 an ounce and traded at $985.55 at 11:12 a.m. in Singapore. The price is down 2 percent from the 11-month high of $1,006.29 reached on Feb. 20. “The market is choppy,” said William Leung, a gold trader at Standard Bank Asia Ltd. in Hong Kong, by telephone. “The funds are buying gold but there is Japanese selling.” Gold, the only metal to advance in 2008, may trade between $875 and $1,000 an ounce, reaching new highs if equity markets stay weak, Leung added. In Asia, the MSCI Asia Pacific Index fell 2.4 percent to 74.48 at 11:53 a.m. in Tokyo, and is set for its lowest close since August, 2003. Some investors are turning to havens including the Japanese yen and gold amid the global downturn, a Morgan Stanley currency strategist Ned Rumpeltin said in a report this week. The yen has climbed 16 percent in the past six months, the only major currency to gain versus the dollar, while gold is up 21 percent. Global stocks tracked by the MSCI World Index of 1,684 stocks have slumped 18 percent this year on concern the economic slump may worsen. Gold has climbed 12 percent. Investment demand has pushed gold holdings in exchange-traded funds to records. Upward Momentum “A surge in physical demand as investors continue to stream into physically backed gold investment products has been the driving force,” said a Goldman Sachs JBWere Investment Research report by Malcolm Southwood in Melbourne, and Paul Gray and Kirstine Veitch in London. “There is every possibility that gold could move to the top end of our 2009 trading range of $850-$1,050 an ounce over the next few weeks if there is little in the way of positive economic data releases to halt the recent momentum,” they added. Gold, which topped $1,000 in March as interest-rate cuts by the U.S. Federal Reserve weakened the dollar, is 45 percent up from a low of $682.41 in October amid concerns about the banking system after Lehman Brothers Inc. collapsed. Platinum advanced 0.2 percent to $1,079 an ounce at 11:02 a.m. Singapore time, extending a five-week rally. “We expect the fall in industrial demand this year to be partly offset by stronger discretionary off-take for jewelry and investments,” said Southwood. Silver for immediate delivery fell 0.4 percent to $14.3638 at 11:07 a.m. Singapore time. The metal has surged 26 percent this year and is the best performer among the 26 contracts on the UBS Bloomberg Constant Maturity Commodity Index. It plunged 23 percent in 2008.

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