Reuters: US Dollar Report: GLOBAL MARKETS-Shares buoyed by Alcoa earnings, dollar gains on yen

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GLOBAL MARKETS-Shares buoyed by Alcoa earnings, dollar gains on yen Jan 9th 2013, 08:35 Wed Jan 9, 2013 3:35am EST * European shares lifted by quarterly earnings hopes * Expectations of BOJ easing see dollar gain versus yen * Oil dips ahead of Chinese trade data due Thursday By Richard Hubbard LONDON, Jan 9 (Reuters) - European shares rose slightly on Wednesday, ending two days of losses after aluminium giant Alcoa opened the U.S. earnings season with an optimistic outlook for world demand. But with a light data day in prospect for Europe, featuring mainly German and Greek industrial output figures, and with European and UK central banks due to meet on Thursday, market movements were expected to be limited. Shares in Alcoa, the largest aluminium producer in the United States, rose 1.3 percent in after-hours trade after it reported a fourth-quarter profit in line with Wall Street expectations and revenues which beat forecasts. "Alcoa's results are generally considered a bellwether for the global economy and the fact that the aluminium giant forecasts higher demand in 2013 appeased investors," Stan Shamu, a market strategist at IG, wrote in a trading note. The results lifted Asia stock markets and saw Europe's FTSE Eurofirst 300 index gain around 0.4 percent in early trade. London's FTSE 100, Paris's CAC-40 and Frankfurt's DAX were up to 0.6 percent higher. U.S. stock futures suggested a firmer Wall Street start with a 0.15 percent gain. Corporate profits are expected to be higher than the third quarter's lacklustre results, but analysts' estimates are down sharply from where they were in October. "Expectations are quite low going into the earnings season as we saw a lot of downward guidance in the past few months. There is potential for an upside surprise to come through," Robert Parkes, equity strategist at HSBC Securities, said. In European fixed income markets German Bund prices dipped slightly as investors prepared for the government's auction of 5 billion euros worth of new five year bonds following successful debt sales in Austria, the Netherlands and Ireland on Tuesday. The dollar meanwhile was stronger against the Japanese yen on expectations of a much bolder monetary easing from the Bank of Japan at its next meeting later this month. The U.S. currency was up 0.7 percent at 87.65 yen, having hit an intraday low near 86.83 yen in Tokyo, its lowest in nearly a week and a loss of about 1.9 percent from last Friday's peak of 88.48 yen, its highest since July 2010. The euro held steady against the dollar at $1.3080, Brent crude oil was also steady below $112 per barrel as the market awaited the latest trade data from China, the world's biggest energy consumer, due on Thursday. "What we're seeing in the oil markets is the cautious sentiment playing up ahead of some key economic events this week," said Ker Chung Yang, senior investment analyst at Phillips Futures in Singapore. However, iron ore jumped to its highest since October 2011, stretching a rally that has lifted prices by more than a third since December as China replenished stockpile's and supply in the spot market remained limited. Link this Share this Digg this Email Reprints

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