SEOUL - Commodities plunged to their lowest level in eight months on Tuesday, extending two weeks of losses. The retreat came on concern that the global share-market rout will slow the economy and erode demand. Gold jumped to a record on demand for a haven.

Standard & Poor's GSCI Index of 24 raw materials tumbled as much as 3.6 percent to 598.46, the lowest level since Dec 2, and was at 611.73 at 3:30 pm in Seoul. The measure has dropped 5.2 percent in two days, extending last week's 5.9 percent decline. Oil lost as much as 6.9 percent to the lowest level in more than 10 months, and copper fell to an eight-month low.

"The market is now worried about another global recession," said Natalie Robertson, a commodity analyst at Australia & New Zealand Banking Group Ltd in Melbourne. "The S&P downgrade of the US credit rating has fueled a lot of those concerns. The market is also focusing on the European situation."

Investors dumped equities and most raw materials for the perceived safety of US Treasuries, the Swiss franc and gold amid escalating debt concerns in the United States and Europe. The MSCI Asia Pacific Index, which last week entered a so-called correction after falling more than 10 percent from its May peak, slumped as much as 5.5 percent on Tuesday, falling for a sixth straight day.

Crude for September delivery fell as much as 6.9 percent to $75.71 a barrel in electronic trading on the New York Mercantile Exchange and last traded at $79.08 a barrel.

G7 ready for action

Group of Seven nations have said they will take every action necessary to stabilize financial markets after S&P lowered the US rating by one level to AA+. The European Central Bank started buying Italian and Spanish bonds.

China's exports will be hurt "badly" should the US debt rating downgrade spur a slowdown in the global economy, according to Credit Suisse Group AG.

Chinese inflation

Inflation in China, the world's biggest consumer of energy, iron ore, soybeans and copper, accelerated to the fastest pace in three years in July. Elevated inflation shows that China is still dealing with the after-effects of an unprecedented monetary expansion during the last global slump and may have limited room for further stimulus.

Copper for three-month delivery fell as much as 3.8 percent to $8,446.25 a ton and traded at $8,748 a ton in London. Gold for December delivery climbed as much as 3.6 percent to $1,774.80 an ounce, a record for the most active contract.

Wheat for December delivery dropped as much as 1.9 percent to $6.82 a bushel on the Chicago Board of Trade. Corn for December delivery declined as much as 2.3 percent to $6.70.

Bloomberg News