Gold hit a fresh record high on Thursday as the dollar struggled, while emerging market stocks climbed to their highest level this year, Reuters reported. Wall Street looked set for a buoyant start and European shares were around 1 percent higher, essentially unmoved by the Bank of England and European Central Bank both keeping interest rates unchanged. Market sentiment was also boosted by aluminium giant Alcoa's posting of a surprise profit on Wednesday after three consecutive quarterly losses. The company was the first major report in the U.S. third-quarter earnings season which will go a long way to deciding the fate of a sharp equity rally dating back to March. Spot gold topped $1,058 per ounce to mark a record high for the third session in a row, before dropping back to around $1,053. It has primarily been driven higher by the weakening dollar, which makes the dollar-denominated metal more attractive to investors. In some currencies -- the high-flying Australian dollar, for example -- gold has actually fallen in price this year. "Investors are turning towards gold as a hedge in dollar weakness," said Adrian Koh, an analyst at Phillip Futures in Singapore. The dollar was down 0.6 percent against a basket of major currencies, close to its year lows. The currency has been hit by a combination of expectations that U.S. interest rates will stay low for some time and a belief that the global economy is on the mend, easing the motivation behind last year's flight to dollar safety. The euro was up 0.5 percent at $1.4752 and the dollar lost a quarter of a percent to 88.32 yen. The Australian dollar gained 1.4 percent, still benefiting from this week's rate hike. It has now gained nearly 28 percent against the U.S. dollar this year. World stocks were putting in another positive performance, with MSCI's all-country world index up three-quarters of a percent. Its emerging market counterpart was up 0.8 percent at a new high for the year. The two indexes have gained around 27 percent and 65 percent, respectively, this year. The pan-European FTSEurofirst 300 was up nearly 1 percent, boosted in part by commodity-related stocks and bullish sentiment over the Alcoa earnings. "It is now all about anticipating quarter-three earnings. There is a general sense that quarter-three earnings are going to be more positive than expectations," said Bernard McAlinden, market strategist at NCB Stockbrokers. Earlier, Japan's Nikkei closed up 0.3 percent. Demand for short-dated euro zone debt slipped with the Schatz yield at 1.27 percent.
