October 25, 2018 / 1:18 AM / a month ago

PRECIOUS-Gold hovers near 3-month peak as equities plunge

BENGALURU, Oct 25 (Reuters) - Gold prices firmed early on Thursday, hovering near a more than three-month high reached earlier this week, as the U.S. dollar eased and Asian stocks slumped after Wall Street surrendered all its gains for the year.

FUNDAMENTALS

* Spot gold was up 0.2 percent at $1,236.43 an ounce at 0107 GMT, not far off Tuesday’s $1,239.68, the highest since July 17.

* U.S. gold futures were up 0.6 percent at $1,238.50 an ounce.

* Asian shares dived on Thursday as hundreds of billions of dollars haemorrhaged from global markets after a rout in tech stocks inflicted the largest daily decline on Wall Street since 2011, wiping out all its gains for the year.

* The dollar index, which measures the greenback against a basket of six major currencies, was down 0.2 percent.

* Sales of new U.S. single-family homes fell to a near two-year low in September and data for the prior three months was revised lower, the latest indications that rising mortgage rates and higher prices were sapping demand for housing.

* The U.S. Federal Reserve should continue raising interest rates at least two but probably three more times before assessing whether further rate hikes to restrain growth are warranted, Dallas Federal Reserve Bank President Robert Kaplan said on Wednesday.

* President Vladimir Putin said on Wednesday that Russia would be forced to target any European countries that agreed to host U.S. nuclear missiles following Washington’s withdrawal from a landmark Cold war-era arms control treaty.

* The European Central Bank seems certain to keep policy unchanged on Thursday but is likely to acknowledge the growth outlook is deteriorating, even if not yet enough to derail a carefully crafted retreat from stimulus.

* An uncompromising challenge to EU budget rules by Italy is providing the first big test for reforms introduced to save the euro zone nine years ago.

* Saudi Arabia’s powerful Crown Prince Mohammed bin Salman vowed on Wednesday that the killers of Jamal Khashoggi would be brought to justice, in his first public comments since the journalist’s murder sparked global condemnation.

* Holdings in SPDR Gold Trust, the world’s largest gold-backed exchange-traded fund, rose 0.24 percent to 749.64 tonnes on Wednesday.

DATA/EVENT AHEAD (GMT)

1145 ECB announces interest rate decision

1230 ECB President Mario Draghi holds news briefing

1230 U.S. Durable goods Sep

1230 U.S. Goods trade balance Sep

1230 U.S. Wholesale inventories Sep

1230 U.S. Weekly jobless claims

1400 U.S. Pending homes sales Sep (Reporting by Vijaykumar Vedala in Bengaluru; editing by Richard Pullin)

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