Gold Prices Today Higher After Global Stock Markets Crash

Gold prices today were higher as global markets plummeted and U.S. equities had one of their worst opens in history.

In mid-morning trading Monday, the gold price was up $3.20, or 0.28%, to $1,164.60.

China's Shanghai Index fell 8.49% Monday, pushing investors to safe-haven investments like gold. The decline wiped out all the benchmark's year-to-date gains, pushing it into negative territory. At its June peak, the index was up a whopping 60%.

The sell-off sparked a painful plunge in equities across Asia, Europe, and the United States.

goldThe Dow Jones Industrial Average sank more than 1,000 points, or 6%, in early trading. It was the worst open for the index since the financial crisis. The biggest drop for the benchmark was 777 points, or 7%, on Sept. 29, 2008.

Worries over the economic health of China are at the heart of today's stock market crash.

Concerns have heated up about a significant slowdown in the world's second-largest economy. China accounts for 15% of the world's economic output and has contributed as much as half of the world's growth in recent years.

Fears have intensified over the last several weeks after China's central bank initiated two surprising rounds of currency devaluations. The moves fueled fears of a currency war.

Now, worries are swirling that the currency move may be backfiring, causing funds to leave the Asian nation in a hunt for yield and stability.

Those worries have investors piling into safe-haven gold.

And the jump for gold prices today is just the start. Here's why the gold price will likely see more upside in the near term...

Gold Prices Today Rise to Seven-Week High

The gold price rebound started last week.

Gold prices rose $6.40, or 0.6%, to end Friday's session at $1,159.50 an ounce. That marked the yellow metal's highest level in seven weeks. For the week, the gold price soared 4.20%, or $46.70.

Concerns over China's economy will continue to boost gold prices. Investors buy gold in times of political and economic uncertainty in the belief it will keep its value better than such assets as stocks, bonds, and currencies.

But China wasn't the only thing that drove investors into gold.

Gold also benefited from investors wagering that global economic woes will force the U.S. Federal Reserve to put off raising interest rates.

The Fed signaled last month that it remains on track to implement its first interest rate hike since June 2006 this year. The move could come as soon as September, when the central banks meets mid-month.

Yet many experts say China's downturn and uneven growth in the United States will prompt the Fed to pause on a rate increase in the near term.

"Globally, there's some issues out there, and we're going to be on hold until these things resolve themselves, and metals will be much higher," said Peter Hug, director of metals trading at Kitco. "I'd be willing to bet the farm that the Fed isn't going to go anywhere near a rate increase in September."

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How to Protect Yourself from Today's Stock Market Crash: Investors around the world are panicking as global markets continue to fall on "Black Monday." But you don't need to worry. In fact, with this strategy, you can protect your money and even profit when the markets are crashing...

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