Wednesday, January 05, 2011
NEW YORK: The U.S. dollar rose Tuesday, pulling the euro from a three-week crest and decreasing gold prices harshly.
Weak consumer stocks on Wall Street and a guess by Morgan Stanley that the standard S&P 500 would lose position in 2011 weighed on opinion a day after the S&P 500 and the Dow increase by two-year highs.
An unexpected boost in U.S. factory orders in November was reported on Tuesday. Orders recorded their biggest profit in eight months.
“No reason that the [U.S.] market is down other than it is up a lot. The news is good, but you could get a 4 to 5 percent correction out of nowhere only because stocks are up a lot,” said Jim Awad, managing director of Zephyr Management in New York.
“But the forward momentum is likely positive, supported by increasingly good news in the economy,” he added.
Spot gold prices tumbled below $1,400 an ounce, losing $28.05, or 1.98 percent, to $1,385.70.
“Pressure [on gold] is expected to return over the next week based on our expectation for a problem in oil prices, gains in the stock market and general stability in the dollar,” MF Global said in a note.
Copper fell from a record high hit Monday, dropping 7.7 cents, or nearly 2% to $4.38 per pound in New York trade. Crude oil prices fell $2.43, or 2.65%, to $89.12 per barrel.
http://www.dailystar.com.lb/article.asp?edition_id=10&categ_id=3&article_id=123228#axzz1Arb7bzGh
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