Reuters: US Dollar Report: GLOBAL MARKETS-Stocks hold near records, greenback rises

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GLOBAL MARKETS-Stocks hold near records, greenback rises May 6th 2013, 17:36 Mon May 6, 2013 1:36pm EDT * Dollar gains vs yen on U.S. outlook, test of 100 yen level seen * Euro weakens after Draghi comments * Global gains in stocks stall after recent records * Oil briefly pares Syria-related gains, demand a concern By Rodrigo Campos NEW YORK, May 6 (Reuters) - The U.S. dollar rose against the yen and euro on Monday and U.S. stocks hovered near last week's record highs as a brighter outlook for the U.S. economy following last week's jobs report continued to encourage the hunt for high-yielding assets. The euro fell against the greenback after European Central Bank President Mario Draghi said the bank, which cut interest rates last week, is watching economic data and is ready to act again. Purchasing managers indexes on Monday showed recession dragged on euro zone companies and business growth flagged in China, adding to a report on Friday that U.S. corporate growth slowed in April. Many analysts have expected a pullback in U.S. equities for weeks now as the S&P 500 index hit a historic high. Wall Street has largely avoided a correction as traders have used weakness as an opportunity to add to long positions. "Everyone is settling in for the moment; we had a nice week last week and there are no real catalysts to move us significantly one way or the other today," said Mark Martiak, senior wealth strategist at Premier/First Allied Securities in New York. U.S. employment rose more than expected in April, with 165,000 jobs created, and hiring was much stronger than thought in the previous two months, the U.S. government said on Friday. The report eased concerns raised by other data that had pointed to the U.S. economy losing steam. In afternoon trading, the Dow Jones industrial average rose 1.36 points or 0.01 percent, to 14,975.32, the S&P 500 gained 3.47 points or 0.21 percent, to 1,617.89 and the Nasdaq Composite added 13.78 points or 0.41 percent, to 3,392.42. The euro zone's blue chip Euro STOXX 50 index closed down 0.5 percent after hitting a near two-year peak on Friday. A 0.56 percent rise in MSCI's broadest index of Asia-Pacific shares outside Japan left the MSCI world equity index little changed. Brent crude oil futures hit their highest since April 11 on supply concerns followed Israeli air strikes on Syria on Friday and Sunday. But crude pared gains on demand worries cemented on the weak data from China and the euro zone, though it later bounced back. "The attack over the weekend of Israel on Syria, on the one hand, can lead to some increased geopolitical premium," said Olivier Jakob, oil analyst at Petromatrix in Switzerland. "But the global PMIs are weak and that in itself is not really bullish for distillates because the economy is still not providing signs that a strong recovery is ahead. Global oil demand is driven by distillates." Brent was last up 0.7 percent at $104.88 per barrel after hitting $105.49 earlier. U.S. crude futures added 0.1 percent at $95.73. DOLLAR STRENGTHENS The U.S. dollar rose for a third straight session against the yen and looked set to make another run at the 100-yen level after last week's surprisingly strong U.S. jobs data rekindled optimism about the U.S. economy. The dollar rose 0.4 percent to 99.40 yen, having hit 99.45 yen, its strongest since April 25, according to Reuters data. The euro also weakened against the greenback after Draghi's comments on possible further easing, but stayed within last week's range. The euro zone single currency was recently down 0.3 percent at $1.3073. U.S. Treasuries prices slipped slightly on Monday as investors continued to digest Friday's better-than-expected jobs report, which sent yields surging to their highest in three weeks. U.S. government bonds are expected to stay at the relatively higher yields as investors prepare for $72 billion in new supply this week. Benchmark 10-year Treasuries yielded 1.77 percent, up from 1.74 percent on Friday and up from 1.62 percent before the jobs data was released. Billionaire investor Warren Buffett said in an interview with CNBC that the U.S. economy is gradually improving, but low interest rates have made bonds "terrible investments" while stocks remain "reasonably priced." Gold prices were little changed after two weeks of gains, on expectations last month's price slide to the lowest in more than two years has run its course for now. Spot gold was recently down 0.1 percent at $1,468.40 per ounce. Link this Share this Digg this Email Reprints

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