LONDON - Commodities led a sharp, broad decline in risk assets on Monday as weaker-than-expected Chinese data added to concerns raised by US numbers about the global economic outlook.
Oil fell towards US$100 (S$125) a barrel, copper dropped to its lowest level in eight months, while commodity-linked currencies including the Aussie and Kiwi dollars were also hit hard.
China's recovery unexpectedly stumbled in the first three months of 2013, as it reported its annual growth rate eased to 7.7 per cent from 7.9 per cent in the final quarter of last year. Economists had forecast 8 per cent growth.
Industrial output in March also undershot expectations and added to investor sensitivity after a negative reading of US consumer sentiment, soft retail sales, plus rekindled worries in the euro zone late last week.
Brent crude futures dropped more than US$2 to below US$101 a barrel for the first since July last year as the Chinese data stirred recovery fears before edging up to US$101.67 by 0715 GMT.
"The China data is going to have a major impact on an already weak commodity market," said Jonathan Barratt, chief executive of commodity research firm BarrattBulletin.
"Generally the trend for commodities remains weak at the moment, given that China is not performing the way we've always wanted it to perform, which suggests (prices are) coming under pressure."
Asian shares outside Japan had reacted with a modest 0.8 per cent fall but European equity markets started the week steady as small gains by Paris's CAC-40 and Frankfurt's DAX helped offset a slightly weaker FTSE 100 in London.
Meanwhile, gold slumped to a two-year low as investors continued to dump bullion on concerns about central bank sales and shifting sentiment towards precious metals.
Spot gold fell as far as US$1,427.14 an ounce to its lowest since April 2011, and was last down 2 per cent at US$1,452. Spot silver fell to its lowest since November 2010 of US$24.32 an ounce and was last at US$24.52, down 4.7 per cent on the day.
In the currency market, last week's weak US data continued to weigh on the dollar, sending it as low as 97.55 yen before it recovered some ground to 98.11 yen. The euro also started the week on the back foot as it fell 0.3 per cent to US$1.3090.
It was the commodity-attunded Aussie and Kiwi dollars that saw the biggest impact from the Chinese data, however.
The Kiwi slumped 1.0 per cent to US$0.8499, stopping short of support at US$0.8480 while the Australian dollar slipped further away from a three-month high of US$1.0583 marked on Thursday to US$1.0434.