YAHOO [BRIEFING.COM]: A resumption of the stock market's downward trend left stocks to suffer another round of steep losses. That prompted another push into traditional safe havens.

Continued volatility has filled participants with a sense of uncertainty, making for a jittery market. So, as traders turned to sell the gains scored during the prior session's near 5% rally, which was the best single-session spike in more than two years, many others began to pile on their sell orders, thus perpetuating further selling pressure.

Stocks did attempt to improve their position in mid-afternoon trade, but the effort eventually ran into resistance. Stocks proceeded to roll over and settle at session lows, essentially offsetting the prior session's advance.

For the third straight session financials were the most influential stocks. The sector slumped to a 7% loss as rumors swirled about bank capital levels and exposure to Europe. French banks were sold aggressively in response to fears that France might lose its AAA-credit rating, even though both Moody's and S&P have stood by their ratings.

Few stocks successfully avoided this session's sell-off, let alone staged advances. However, Polo Ralph Lauren (RL 125.28, +5.43) managed to trade higher following news of its upside earnings surprise. Cree (CREE 34.08, +4.59) actually spiked sharply following its better-than-expected earnings results. The company's downside guidance was shrugged off.

Want for safety helped sent gold prices to a new record high above $1800 per ounce before it eased back to close at $1784.30 per ounce for a 2.4% gain. Gold's continual climb has helped drive the SPDR Gold Trust ETF (GLD 174.58, +5.97) to an all-time high.

Gains by the greenback sent the Dollar Index to a 1.1% gain, which was enough to put it back above its 50-day moving average at 74.7.

Treasuries were up all session, but rallied aggressively into the close. That took the yield on the benchmark 10-year Note down to about 2.08%, which is only five basis points above the record low that it set yesterday. There wasn't much of a response to results from an auction of 10-year Notes. The auction drew a bid-to-cover ratio of 3.2, dollar demand of $77.3 billion, and an indirect bidder participation rate of 35.2%. For comparison, an average of the past six auctions gives a bid-to-cover of almost 3.2, dollar demand of $69.9 billion, and an indirect bidder rate of 50.3%.

The Treasury released its budget for July today. It showed a deficit of $129.0 billion, which is less than the $132.0 billion deficit that had been expected, on average among economists polled by Briefing.com.

Another session, another new all-time high for gold futures, this time the mark is above the $1800 level at $1801.00. Concerns about Europe sparked the rally in precious metals as the flight to safety was on once again. Dec gold spent most of the afternoon session pulling back from those highs, but managed to add another 2.4% to its recent rally to close at $1784.30 per ounce. Sept silver rallied to its best levels, at $39.58, heading into the afternoon session, and closed just shy of those highs, higher by 3.9% at $39.37 per ounce.

Sept crude oil, which settled higher by 4.5% to $82.89 per barrel, was aided by this morning's bullish inventory data, which showed a large draw down versus consensus for a build. Crude traded to fresh highs at $83.14 heading into the close of pit trade and finished just shy of that high. Sept natural ended the day near flat at $4.01 per MMBtu.

Advancing Sectors: (None)
Declining Sectors: Utilities -2.1%, Telecom -2.7%, Materials -3.3%, Consumer Staples -3.6%, Energy -3.8%, Tech -4.1%, Health Care -4.2%, Consumer Discretionary -4.4%, Industrials -4.9%, Financials -7.1%DJ30 -519.83 NASDAQ -101.47 NQ100 -4.1% R2K -5.2% SP400 -3.4% SP500 -51.77 NASDAQ Adv/Vol/Dec 505/3.39 bln/2126 NYSE Adv/Vol/Dec 835/2.15 bln/2272