Gold pushed towards the key $1,000-a-troy-ounce level on Tuesday amid a widespread sell-off in stock markets and mounting concerns over the health of the global financial system. However, oil prices fell sharply as the recent pattern of highly volatile trading in thin market conditions continued.

Gold rose 1.6 per cent to a four-month high of $987.75 a troy ounce as investors sought safety in the yellow metal from sharp falls in equity markets and a retreat in the dollar to record lows against the euro.