Euro zone bailouts is waning

Financial markets viewed the loss as a strong indication that support for euro zone bailouts is waning. Coupled with last Friday’s losses, the Stoxx Europe 600 Index posted its largest two-day decline since March 2009. The euro currency tumbled to 1.4060 against the U.S. dollar, its lowest level in over a month.

The rally in the gold price follows a 3.1% rise last Friday, when the yellow metal surged following the worse than expected U.S. non-farm payrolls report. As economic data deteriorates across the globe, investors are increasingly moving a greater percentage of their assets into gold as a safe haven and store of value.

Gold price traded to yet another record high at $1,921 per ounce overnight before moving back below $1,900 Wednesday morning. The price of gold surged following heavy liquidation in European stock markets on the back of a key election loss by German Chancellor Angela Merkel’s political party. S&P 500 stock futures plunged 27.30 to 1,142 while the cyclically-sensitive copper price, lower by 1.8% to $4.05 per pound, headed for its largest loss in over a month. The gold price rallied and equity markets in Asia and Europe posted steep losses amid escalating euro zone sovereign debt concerns. The rising fears stemmed from the news that German Chancellor Angela Merkel’s political party suffered its fifth election loss this year and its worst showing since 1990.