Reuters: US Dollar Report: GLOBAL MARKETS-Stocks head for monthly loss; euro slips

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GLOBAL MARKETS-Stocks head for monthly loss; euro slips Apr 30th 2012, 16:22 Mon Apr 30, 2012 12:22pm EDT * World equity index on track for monthly loss of 1.5 pct * Spain joins list of euro zone nations in recession * Dollar rebounds from 2-month low, Treasuries advance By Wanfeng Zhou NEW YORK, April 30 (Reuters) - Global shares edged lower on M onday, heading for their first monthly loss this year as Spain sank into recession and the U.S. economy showed signs of slowing. Treasury prices rose, while the euro fell and the dollar slipped to a more than two-month low against the yen as anxiety over economies on both sides of the Atlantic led investors to favor lower-risk investments over stocks and other risky assets. Spain, the euro zone's fourth-largest economy, slipped into recession in the first quarter as domestic demand fell, joining Italy, Portugal, Ireland, Greece, Belgium and the Netherlands on the list of countries with shrinking economies. In the United States, consumers boosted spending only modestly last month and a gauge of Midwestern business activity fell sharply in April, suggesting the economy entered the second quarter with less steam. "Growth is beginning to fade around the world," said Justin Hoogendoorn, fixed income strategist at BMO Capital Markets in Chicago. The MSCI world equity index slipped 0.3 percent to 328.35. It was on track to post a monthly loss of 1.5 percent, though it was still up 10 percent so far this year. On Wall Street, U.S. stocks slipped, with the S&P 500 falling below the psychologically important 1,400 level and on track for its first monthly decline since November. "We had such a strong first quarter, and we've lost that momentum in the last two weeks," said Jake Dollarhide, chief executive officer of Longbow Asset Management in Tulsa, Oklahoma. The data "reinforces the ominous tone on Wall Street, along with the fears we have about Europe." The Dow Jones industrial average was down 33.83 points, or 0.26 percent, at 13,194.48. The Standard & Poor's 500 Index was down 6.93 points, or 0.49 percent, at 1,396.43. The Nasdaq Composite Index was down 17.08 points, or 0.56 percent, at 3,052.12. In the euro area, trading was light ahead of May Day holidays o n T uesday, elections in France and Greece at the weekend and a European Central Bank meeting on Th ursday where policymakers will have to consider the region's worsening economic health. The FTSEurofirst 300 index of top European shares ended down 0.8 percent to 1043.28. Emerging market shares however, gained 0.4 percent. EURO ZONE STRESS The euro fell 0.2 percent to $1.3230, off a near one-month high of $1.3270 hit on Friday. It was on track for its worst month since December. Signs of a deepening euro-zone recession raised worries that governments could soften their approach to tackling budget deficits. Several countries in the region are under intense pressure to cut spending to help reduce their debt to sustainable levels. Growing opposition to austerity measures is expected to be a large factor in weekend elections in France and Greece after disputes about austerity brought down center-right coalition governments in the Netherlands and Romania last week. "There is clear risk aversion in the market," said Boris Schlossberg, director of FX research at GFT in Jersey City, New Jersey. "In short, the news from Europe continues to point to further structural stress in the system." The dollar lost 0.4 percent to 79.90 yen after falling as low as 79.71 yen, the lowest level since February. The pair was on track for its worst month since July 2011. The greenback briefly touched a two-month low against a basket of currencies at 78.638, its lowest since March 1, before recovering to 78.836, up 0.2 percent on the day. The benchmark 10-year U.S. Treasury note was up 5/32, the yield at 1.9172 percent. In commodity markets, gold prices steadied around $1,660 an ounce on speculation of a third round of liquidity stimulus from the Federal Reserve . Brent June crude futures were down 73 cents to $119.10 a barrel and on track to close lower for the second consecutive month. U.S. crude was down 67 cents at $104.26 a barrel. Link this Share this Digg this Email Reprints

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